Selecting the USB option in the builder did not work on Vista, 2008, or Windows 7 because of UAC.
This has now been fixed. If you select USB, during the build process you will be prompted to elevate this step. Make sure you click Yes.
Also, if you want to use the USB function, make sure the USB device is plugged in before the build process starts. The builder does not check for new devices after it has been launched.