I have not used MultiSystem, but that one I have seen recommended as well as several others.
MultiBootUSB - Install and boot multiple Linux from Pendrive / Flash drive / USB disk w/grub2
https://help.ubuntu.com/community/InstallAndBootMultipleLinuxFromPendriveFlashDriveUSBDisk
See yumi for multi-boot versions
http://www.pendrivelinux.com/
But to understand it better you can just install grub2 to the flash drive, create your own grub.cfg with boot stanzas and copy ISO into flash drive. Very similar to a hard drive install like this link.
https://help.ubuntu.com/community/Grub2/ISOBoot
To install grub2 into a flash drive, default /media now varies depending on version. New version add the user to the path. Also assumes sdb as flash drive, confirm that is correct if not sure.
Label partition - if label is grub2 & mount:
sudo grub-install --root-directory=/media/grub2 /dev/sdb
Newer versions automount with $USER name also, this one labeled MC4GB, with user fred
sudo grub-install --root-directory=/media/fred/MC4GB /dev/sdb
In creating grub.cfg, the boot drive is always hd0, so if directly booting from flash drive setting will be hd0,Y where Y is partition usually 1.
loopback loop (hd0,1)$isofile
Otherwise examples are like these:
https://help.ubuntu.com/community/Grub2/ISOBoot/Examples
First entry in my grub.cfg in MC4GB
set default=0
set menu_color_normal=cyan/blue
set menu_color_highlight=white/blue
set gfxpayload=800x600
menuentry "Ubuntu 13.04" {
set isofile="/boot/iso/ubuntu-13.04-desktop-amd64.iso"
loopback loop (hd0,1)$isofile
linux (loop)/casper/vmlinuz.efi boot=casper iso-scan/filename=$isofile nomodeset
initrd (loop)/casper/initrd.lz
}
menuentry " " {
set root=
}
Note I added nomodeset to all entries as I have nVidia.
Also new versions now use vmlinuz.efi for both BIOS & UEFI boot. Older versions were just vmlinuz.
Other distributions may need different boot parameters. Find example in above example thread or mount and check what ISO has for its boot parameters.
A Two Partition Solution
You may be able to get by with 2 (or 3 if you want a Swap) partitions, one for the Full Ubuntu and another for data storage and exchange. Full Ubuntu will install GRUB by default. Modify GRUB to add extra entries that point directly to iso files stored in the first partition along with Ubuntu.
See How to boot from non-Ubuntu live ISO images like Fedora or CentOS? for more details about how to add ISO entries in the GRUB.
Method
First create a primary FAT32 partition in the beginning of the USB for storage. make it the size you want. Alternately, you may shrink the existing partition to the size of general storage partition you want. It is important that this be the first partition, as Windows will only recognize the first partition as the storage partition. The FAT32 format will ensure that it is compatible will most operating systems.
Second Install Ubuntu in the freed up empty space after the first partition. Also make sure the bootloader (GRUB) is installed in the correct USB and not in your hard drive or in the other USB if you are using a Live USB to do the installation from. Choose the whole disk for the GRUB installation. this will look like /dev/sdb, /deb/sdc etc. This will place grub in the MBR. Don't choose a partition such as dev/sdb1.
Third Makes sure everything works so far. Plug the USB into a Windows computer and verify that storage space is readable/ writable. Repeat with Ubuntu and other OSs.
Boot Ubuntu from the USB and make sure it works as expected.
Fourth: Two methods
Easy Method based on Ubuntu Documentation on GRUB2/ISOboot
Install grml-rescueboot
sudo apt-get install grml-rescueboot
Place bootable ISO files in the /boot/grml folder. For example, if the ISO file is in the Downloads folder, type:
sudo mv ~/Downloads/<filename.iso> /boot/grml/
Update GRUB:
sudo update-grub
Next time you boot from the USB, GRUB will have the menu entries for the Full install, as well as all the ISO files.
Manual Method / Hard Method
You may also follow the examples in How to boot from non-Ubuntu live ISO images like Fedora or CentOS? and Ubuntu Documentation ISOboot Examples and edit the file /etc/default/grub and one entry for the first ISO. Make sure the path to the ISO file is correct.
use sudo update-grub command to update the GRUB after editing and saving the /etc/default/grub file.
Repeat for the other ISO files.
Also see this forum post for some more details
Thanks to oldfred for the additional links.
Note: This method of editing GRUB to point to an ISO probably won't work with Windows ISOs.
Hope this helps
Best Answer
The only use for a SDC install nowadays is for making an installer drive.
If you want something that saves your last session you can do a Full install to the flash drive or you can make a Persistent install using mkusb: https://help.ubuntu.com/community/mkusb .
Mkusb has a small boot partition, an ISO9660 read only partition for the OS, an ext4 casper-rw partition for persistence and a NTFS partition for data. Both Linux and Windows can use the data partition.
A persistent install is more compact than a full install but may not be as secure.