Can you install Vista or Windows 7 from an external disk?

[Mysterae_]

I have a Motion Computing Tablet PC (LE1600) running Vista Business and I want to install Windows 7. Firstly I need to install Vista Home Premium (retail version from a disused pc) on it so that I can then use a Windows 7 upgrade - but that's kinda irrelevant!

The problem is there's no DVD drive in this computer and rather than buying an external USB DVD drive to boot and install from, I was wondering if I can copy the Vista and then Windows 7 disks to an external USB hard drive or flash disk (16GB) and install the OS's from that?

Any tips if it's possible?

 

[Mysterae_]

Thanks guys, that's saved me 40 quid on buying an external DVD that I'd only use once!

The only issue that stopped me for a second was this statement in the guide from robinbredin:

"WARNING
With this method:
You can only create a 32-bit Windows 7 USB key from within a 32-bit Vista or Windows 7.
You can only create a 64-bit Windows 7 USB key from within a 64-bit Vista or Windows 7. "

This isn't an issue as the tablet is only capable of 32-bit and my 'normal' pc is Vista 32-bit. Worth knowing though.