DiskWarrior 3 is Here! And a question re: OSX startup from an external drive

[b]

Yes, DiskWarrior 3 is out in a 'peek' format, available 
electronically or via CD in the mail. I just ran it on an external 
drive and it is very fine.

My question though, is this:

What program can anyone recommend for me to install the smallest [in 
terms of MBs] OSX startup folder on an external drive? I've had 
terrible luck lately trying to make boot disks, and i'd like an OSX 
starup from an external [Oxford Semiconductor] drive. Any 
suggestions? Or should i just run the Jaguar Installer with the 
external as the 'target'?  Thanks.

~flipper