Better way to create bootable USB drive?

[chombee]

When you create a bootable USB drive with persistence using Ubuntu's USB 
Startup Drive Creator (I've been using the version in Karmic) you have 
to specify how much of the USB drive should be reserved for the 
persistence space. This reserved space is not available when you just 
use the USB drive as a normal USB drive without booting from it, when 
using the USB drive normally you can't access the files from your Ubuntu 
homedir, when booting from the USB drive you can't seem to access any 
files that were put on the drive when not booting from it.

Is there a better way to create a bootable USB drive? Ideally it would 
just fill the entire drive with a partition, install Ubuntu onto that 
partition, and have the whole remaining space of the partition available 
to save files when booting from the drive. When using the drive without 
booting from it the same partition, including the Ubuntu files, homedir, 
and desktop, would be available for reading and writing. This would be 
significantly more useful.