No love here either. I tried twice yesterday with two different 4gb usb sticks but the end result shows even after restoring the image, the drive shows unallocated space

that is strange, you don't even have a filesystem on your usb stick? In that case something goes wrong with creating the usb stick.
Did you use latest usbimagetool from squeezeplug.de?

That's a possibility maybe that I used the tool that came with the previous image[*]

Does the usbit tool version make any difference? even I'm using the one which came with, the old image.

i don't think so but if your usb stick does not contain any files after restoring the image, it might be useful to try the latest version.

Quick update, I am running version 1.57 of the tool which is the latest version.

and does your usb stick contain a filesystem after restoring the image?

Yes. But it will not boot, and it takes up full space on a 8 gb flash drive. Partition type is set to loop.

Are you on linux or windows? The problem is that i use only linux computers and made the image using a virtualized windows environment. When you are on linux and know how to work with dd i can sent you an image of my usb stick which works on my tonidoplug.

dunno what i am doing wrong. using the usbit 1.57 to restore the image on 4gbx2 and one 16gb usb sticks... they all end up as unallocated space. re-downloading the image.