Humm a GNU/Linux liveUSB with dev tools out of the box eh, wanna try this distro -> "ZenWalk Live Edition" http://www.zenwalk.org/modules/tinyc...ndex.php?id=31, but dont just take my word for it go look up their website with that link, says right there -

"Zenwalk's Live Edition is a complete GNU/Linux operating system. Just as with Zenwalk's desktop Edition, out of the box, you will be able to browse, mail, chat, listen to music, program in C, Perl, Python, Ruby,.."

then you can just move it to your pendrive/flashdrive, and your in luck theres a really easy, easy, easy way to do it, just install "unetbootin" to your windows or GNU/Linux OS, have your Zenwalk .ISO (or other chosen linux distro .ISO), have your flashdrive ready and install it. The Application "unetbootin" is pretty fairly straightforward and easy to use".
Here's untebootin url - http://unetbootin.sourceforge.net/

or you can try OneBase Linux - http://www.ibiblio.org/onebase/ , though i've not seen any new developments since 2005, and just scoot it in your pendrive if unetbootin doesnt work just go do it the manual way.

On a side note never used OneBase distro before but a friend mentioned it to me before but like I said havent seen any movement in their website since 2005, I've tried ZenWalk distro before though and its pretty good.

Hope that helps!

How about SliTaz GNU/Linux?

Also, you can order LiveUSB drives with Unix and Unix-like operating systems and software pre-installed. http://www.inatux.com/usbs

Hell, there are shed-loads of distros that can be installed onto a pen-drive.

Depending on the capacity of your pen-drive, it could be anything from tiny distributions like DSL, Slitaz or Puppy, to full fat distros like Fedora or Ubuntu and everything in between.

Take a look at www.pendrivelinux.com it has instructions for installing many flavours of *nix on pendrives. 4Gb is probably enough to install a live version of virtually any distro. And most of 'em ship with some basic development tools, if only gcc, possibly also g++. But you'll still need to install additional development libraries.

Personally I've been running one of my laptops from an 8GB stick with Ubuntu installed for some time now. (Dead HD, can't afford a new one ATM!)
Alongside the Ubuntu liveCD stuff that went on there, I've added lots of other programs (Code::Blocks, MonoDevelop etc.) and development libraries (Boost, wxWidgets etc). And I've still got a good 2Gb or so left over for my projects/documents.

And it performs quite well too. The boot time isn't quite as fast as a native install of Ubuntu because it's basically a liveCD that can be used on virtually any machine, so it probes the system for hardware etc. each time it boots which takes some time and it also has to mount the virtual file-system, which also takes a little time. But the overall speed of the OS is good. However, because it uses a virtual file-system, read/write operations take a little longer than normal, but this is barely noticeable.

As a development platform it's fine. In fact it's great for any purpose! I've been using it for C, C++, C#, Python, Flash development (yes, that's right flash dev on *nix!) and even some video editing. And video playback is smooth.....Nice!

Anyway, good luck!
Cheers for now,
Jas.