Try installing sys-boot/unetbootin.
I usually reformat my Thumb Drive that I'm going to use for installing (that may or may not be necessary, but it makes sure it's clean).
Then just mount the Thumb Drive, start unetbootin, select your iso image, and you've now got yourself a bootable USB drive.
Gigabyte GA-P35-DS3L - Intel(R) Core(TM)2 Duo CPU E6750@ 2.66GHz
nVidia GeForce 7600 GS
2 GB RAM