I ran into this issue when trying to install the OpenOffice.org Portable 2.4.1 release. This issue affects not only OOoP but OOoP is the biggest application. So it's the first one where you run into this problem.
The installer calculates the needed space on the flash drive. If there isn't enough space there you can't go on with the installation (button is greyed out). But the calculation doesn't take into account if a previous release of OOoP (that will be overwritten) is installed on the drive in question. The difference between wrong and right calculation is about 250 MB(!) in this case. So it happened to me that the installer didn't allow me to install the new version.
I see two options to solve this issue:
1. The clean one: When calculating the needed space on the flash drive the installer has to check whether there is a previous version of the app and how much space it takes. This amount has to be subtracted from the needed space for the new version.
2. Not so clean but maybe easier: If the calculation (done as is) tells there isn't enough space offer a button to ignore this information and go on with the installation.