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I've been trying t install a working OS and utilize one of the internal USB ports as a boot disk (4 gig USB Flahs Drive, soon to be replaced with a 16 - wouldn't have ordered it had I known of these troubles) to no avail.
I'm not sure if you mean you couldn't install, or it won't boot after you get it installed.

If it won't install use SuperDuper or CarbonCopyCloner to copy an installation to the USB drive.

After you get an OS on the USB drive, hold down the Option key at start up with the USB drive plugged in to choose it as a startup disk. Probably a very slow startup disk but it should work.

I believe the Mac resets the built in USB bus after power on, I don't know if it does the same for USB cards, but using the Option key bypasses that, it's has already happened by that time.