Comment 15 for bug 914484

As of Icehouse this is still an issue.

Booting from ISO is typically something you do if you want to install a new OS as a user, without having to go through a local hypervisor on your laptop.

The sensible approach would be like the behaviour of Xen, where it behaves much like botting from a CDROM on your server or desktop to install the software on the local hard drive.

So if you boot an ISO on a flavor with 30GB root disk, what should happen is that a Instance is created with an empty /dev/vda of 30GB and the ISO on /dev/vdb (or /dev/sd0 depending on) which is booted from.
It's now straight forward to install the software and save an image.