One possibility is Puppy Linux, by Barry Kauler. There's a good (but by no
means unbiased) comparison of Puppy with other minimal distributions on the
FAQ page:
Here is a link to a special version of Kanotix designed for use on a flash
drive. Kanotix is a 'fork' of Knoppix and is very well implemented. It
weighs in at 245 megs, so it may be larger than you want, but it is quite
nice. And it is very easy to install to the flash drive.
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