USB booting :: Grub error 17 on boot from USB

I have followed the instructions in the wiki for creating a bootable USB stick under Win32. I have booted from this (1GB) usb stick before, using this same computer, and I have had no trouble, however on trying to boot DSL I get "GRUB error 17" which apparently means GRUB cannot mount the filesystem. I have tried it with both FAT16 and FAT32 with the same error.

original here.