I was reading this thread, and I guess you have already resolved the issue with the Recovery Environment CD, but I thought I would add a couple thoughts.

I believe that the Western Digital USB drives (maybe other brands too) have BOTH usb and firewire connections primarily so they can be sold to both PC and Mac users, since Mac's have firewire and most pc's just usb2.

I always assumed you were to use one or the other of the interfaces, NOT BOTH.

Even in Windows XP I think choose one or the other.  I'm surprised XP didn't complain about both cables connected.  Obviously the Ghost 10 RE cd had troubles.

Anyway, glad it's working now.