After searching far and wide the expanse of the world wide web I've come to one conclusion: non-legacy GRUB has sparse documentation. (and I'm being generous)
Without further adieu...
MOBO: Asus P4S533-MX
BIOS: Latest available, USB Booting... check!
CPU: P4 2.8GHz
RAM: 2x512MB
USB-DRIVE: OCZ Rally 2 (2GB)
The contents of the stick comprise of a single (max size) FAT16 (flagged bootable) partition. The file system is in good order, I'm running eclipse and hosting a home folder on the said device with no issues. (and I must say, I'm impressed with the performance!)
I know that the device is bootable, a WinXP produced MS-DOS floppy cloned onto the USB device (bootsector+files) made it bootable and viola: DOS a la USB! ...yuck
Now I'm trying to swap DOS for GRUB 1.95. Said version of GRUB installs into a floppy and the USB device with no errors reported, after a quick visual scan (hexdump) the boot sectors look legit on both. Identical commands used to install GRUB (except the device names of course :^)
However the results slightly vary:
Booting from the floppy yields a grub console, check! (haven't setup a menu.lst etc)
Booting from the USB device yields the string "GRUB " (minus quotes) and a flashing cursor, no cigar. =(
There are numerous articles on putting GRUB onto a USB drive, while the commands are the same for both version, the mention of stage1 and 2 loaders point to use of legacy-GRUB in said articles. (which I haven't tried)
I'm thinking the following: the USB driver missing?
I make'd grub-1.95 from sources, then maybe it's possible to work in some extra drivers in there?
Has anyone else tried to do this? or am I the only one with too much time on my hands?

If you have some suggestions or ideas I'd love to hear them because I'm kind of stuck with this.