The best procedure is to use the GParted program on the Mint 13 CD or DVD to create partitions on the USB drive before you install. If you have 4 GB or ram, make a very small swap partition, 300 MB would be fine. It will never be used anyway, unless you hibernate, then you will need 2 GB.
The rest of the USB drive should be just one / partition. When you only have 8 GB to use, there is no reason to chop it up into small portions.
After partitioning the USB, run the installation, and choose "Something Else", not "Use Entire Drive" . Then you will get the option to use the USB drive, format it to ext4, mount as / Be sure to install the bootloader, grub, to the thumb drive, not your hard drive. That will be the choice at the bottom of the screen when you are looking at the partitions.
Thanks a million guys! I finally got XFCE Maya installed my flash drive with 4.2gigs free! I had to use EXT4 and "/" which was accepted. Thanks!
I already found some minor flaws like the Desktop background "slideshow" feature doesn't continuously change after viewing the first two screens and mysteriously the zoom/expand/quit marks on the windows edge disappear and Windows Manager won't pop up to fix it with, and the only way out to normal is to create a new session, but I'll post these on new topics soon.
I'll be looking for "garbage" collection programs like "Computer Janitor" to create more space once I get programs like Stellarium and Celestra and art files installed, but if you have other recommendations I'd be glad to hear them! My undersranding is that Mint has no "diskcheck" or "CCCleaner" type programs.
More information about Linux on a stick (USB flash drive):
Install Linux Mint On USB Drive And Walk With It: Portable Linux Mint - Muktware