Technically, the answer is "yes" - but practically the the answer is "no". Even if your BIOS supports bootable USB devices, chances are your notebook is only equipped with a USB-1.1 insterface - and 12Mbit/second throughput (roughly 1.2MBytes/second) is about ten times slower than an average ATA drive on a bus mastering IDE controller. Performance would be... horrible.
You may want to check and see if any of the expansion bays avaialble for your notebook can incorporate another HDD (in place of your CD/DVD drive, or in rare cases a second empty expansion bay). This would place the drive on the onboard IDE controller.
Also - I'm not sure what you paid for the Nomad, but you could probably pick up a 20Gig Toshiba 2.5" drive for a lot less than an MP3 player, but this is an excersize in economics best left to the reader.