FYI- I've somewhat cryptically alluded to grand plans for improving LiveCD boot speed on this list in the past.
While I'm still quite some time from having the time to implement it, I did outline my method on squashfs-devel yesterday.
The basic idea is to replace all the disk seeks for file accesses during boot with a single long seek-less read, using a devicemapper trick which I've never seen used anywhere else, but which I'm 99.9% sure will work. I will back off my prior predictions of halving boot time, but I still think 15%-25% speedup will happen...
http://sourceforge.net/mailarchive/forum.php?thread_name=d872d960801070247i7...
-dmc
livecd@lists.fedoraproject.org