Very cool Tutorial for Portable OS!
http://www.ubuntuforums.org/showthread.php?t=80811
Install Ubuntu v5.10 to USB Drive! Works on Flash Drives and HDDs.
I just installed this, and the tutorial was great. Very easy to follow.
I now have ubuntu on my USB HDD, and a 60GB FAT32 Partition for Shared use between it and Windows Boxes (had to customize the partitions, just resize). I've booted from a couple of machines, and it worked on both. I write this from inside ubuntu.
How does this relate to portable apps? Install wine and you can use many of them. I know have a whole system with me, usable in school as 'Nix or on Windows Boxes.