i'm working on building my own (live) installable cd also.
i'm not sure it will do what you want, but bootcd and it's partners (ie. bootcdwrite, etc) will take your running os (ie the one you use everday) and turn it into a 'livecd' which will then (can) be installable to a hd.
the advantage here is it is your own creation (not knoppix or whatever) and you don't have to 'chroot' for anything..
you simply run the command 'bootcdwrite' from within your normaly running system (that you want to make into an iso).
there is a very simple and small config file, and requires only one command at the cmd line. it even gives you the opportunity to continue or quit when it hicups
good luck.