Here are the step by step instructions from my demo the other night, as promised. They are posted here as well as at http://www.drupalatlanta.com/. They are here as a wiki-- feel free to correct anything I messed up.
Installing Drupal onto a Thumb Drive
Step 1) Download Necessary files.
Download the XAMPP ZIP archive (NOT installer) from:
http://www.apachefriends.org/en/xampp-windows.html#641
Download latest version of Drupal from:
http://drupal.org/
Step 2) Place XAMPP on USB Key.
Extract the XAMPP ZIP archive onto your local hard drive. It will create a XAMPP directory with a lot of files into it. Copy this XAMPP directory to your USB key. You should now have a directory on your key called XAMPP.
Step 3) Start and Test XAMPP.
XAMPP will work right out of the box, so give it a try. Open the XAMPP directory on your USB key and run xampp-control.exe
A XAMPP control panel window will appear.
To the right of Apache click start. A green “Running” should now appear to the left of that button.
To the right of MySQL click start. A green “Running” should now appear to the left of that button.
You have now started Apache (your webserver) and MySQL (your database server).
Open up your web browser and enter http://localhost/ as your location. If you see the XAMPP web page your web server is successfully running!
Step 4) Tighten up the security a bit.
After going to http://localhost/ click English, and then on the left hand sidebar click Security.
You should see several red “Unsecure” warnings.
Below the warning should be text that says:
To fix the problems for mysql, phpmyadmin and the xampp directory simply use
=> http://localhost/security/xamppsecurity.php <= [allowed only for localhost]
Click that link and enter a password for mysql root. Remember this password!
After entering the password, click “Password changing”. You should get a message telling you that “The root password was successfully changed. Please restart MYSQL for loading these changes!”.
As it requested, you should restart MySQL: open your XAMPP control panel again, and click “Stop” next to MySQL. After it has stopped, reclick “Start”.
Back in your web browser re-click “Security” on the left side. You should now be more secure. It will tell you that your pages are accessible to everyone on the network – this is ok since you are likely behind a firewall so they are really only accessible to people on your local network. PHP Not running in “Safe Mode” is also OK.
Step 5) Create Database
In your web browser goto:
http://localhost/phpmyadmin
login with the “root” username and password you set above.
Scroll down to “Create New Database”, enter “Drupal” and click “Create”.
Step 6) Install Drupal.
First copy the Drupal files onto your USB Key. Do this by moving the Drupal directory that you extracted earlier into the /xampp/htdocs directory on your USB key.
Once this is done, you should have a directory called /xampp/htdocs/drupal on your USB key. If your directory is named something else (ex: Drupal5.1) rename it to “drupal” for the purposes of this demo.
Now, goto:
http://localhost/drupal/install.php
to Install Drupal.
Leave the database type as mysql, enter “Drupal” as the database name and enter “root” and the password you chose earlier in the username and password fields.
After a bit of thinking, you should get a message confirming that your Drupal Installation is complete!
Goto http://localhost/drupal/ to use your new site!
Step 7) Important to Remember!
Prior to removing your USB key you MUST turn off your web and database server first! If you fail to do this you run a high risk of corrupting your database.
To turn off your web and mysql server, open up your XAMPP control panel, click “Stop” next to Apache and MySQL and then click the “Exit” button.
It is then safe to remove your USB key.
ADDITIONAL ADVICE
I am adding this section to hold pointers that anyone can append to the end. I am using a USB key based website a lot now, and will throw tidbits in here as I come across them.
MySQL Configuration
Since this is intended to be a mobile setup, putting a my.ini file in your windows directory (as is customary for advanced MySQL config settings) doesn't quite cut it. You would have to do this for every computer you worked on. For this reason XAMPP overrides this when starting mysql and points it to a configuration file conveniently held right in your xmapp directory on your USB key. So... if you are looking for your my.ini file in a XAMPP setup, it is actually called my.conf and is located in xampp\mysql\bin.
"MySQL server has gone away" error
This error: "ERROR 2006 (HY000) at line 366: MySQL server has gone away" is likely because you are trying to restore a large DB backup (>3MB) or do something else that requires a lot of information to be transfered. This is because XAMPP defaults mysql to be configured with a fairly low packet size limit. I found this limit far too small for my usage, so I bumped it from 1 MB to 16. Here is how: (1) goto your my.conf file (see above). (2) find the line that says "max_allowed_packet" and make it say "max_allowed_packet = 16M". That should do it.