I have tried with both Linux live usb creator and universal usb creator. The result is the same. I used the ubuntu 12.04 image when was asked to provide the iso.
And when I booted via the USB it presents the installation option.
But what I wanted was a live USB ie that will boot from the USB and it will have an in memory OS with shell where I can execute commands. Besides it will have an option to install to hard disk if wanted.
This is the way I have a CentOS live usb working. But I am not sure what I am doing wrong?