The are several guides online (including a few on the ubuntu website) that follow the general pattern of instructions found in this one.
I assume that at some point, this worked.
However, on an Intel iMac 5.1 with Ubuntu 12.10, it does not work. Each command executes successfully, but the result is a drive that will not boot.
Holding Alt during the boot, as the guide suggests, brings up a menu that does not include the USB drive.
Alternately, booting into rEFIt or rEFInd does in fact show the device, but refuses to boot, producing the error message:
Error: Not found from LocateDevicePath (x 9 times) Error: Load Error while (re)opening our installation volume The firmware refused to boot from the selected volume. Note that external hard drives are not well-supported by Apple´s firmware for legacy OS booting
Perhaps the guide needs to be updated? I'm not sure what to try differently here.
Edit: This is apparently not limited to 12.10. I just had the same issue occur with 12.04.2.
Edit: I get the same issue ("refused to boot") following these instructions: http://userpages.uni-koblenz.de/~ceinig/howto/artikel.php?id=92