I bought myself a 4GB USB drive made by EZcool for AUD$50.  I didn't really have a need for it, but it was a nice price.  For reference, it has a pretty slow write speed of 2MB/sec.

I wanted to make some good use of the drive and in my searches I soon found PortableApps.com.  The site provides a whole host of application that are packaged for easy installation on your USB drive.  You can then plug your USB drive into any Windows PC and run that application.

You can download the applications as a 'suite' which include a selection of applications as well as the PortableApps launcher which sits in your system tray and gives you gives you a type of start menu for all the programs on your pen drive.

Alternatively you can download each application one by one.  They are all just self extracting files.  There's pretty much an application for every task such as virus scanner (ClamWin), photo editing (Gimp), web browsing (Firefox), media players (VLC), office software (OpenOffice) and many more.

You can even get a fully functional portable web server, XAMPP, which includes Apache, PHP, MySQL and more.  It's so simple and functional I no longer feel like I need a dedicated web development box anymore.

The PortableApps launcher will also detect other applications you put on your USB drive, such as OperaUSB, so you can easily start them.

Of course, portable versions of most of these applications has always existed.  But it's nice to find a site that compiles them together in one convienent location.

My next project is to get multiple Operating Systems installed on my USB drive.  Some of them bootable, and others that can be ran from a virtual machine.