grub-installer fails to install grub on mbr of usb pen drive on install.

[Tom Bruno]

Binary package hint: debian-installer

On install of 8.10 Intrepid to 4GB Pen drive. Using 8.10 Ubuntu Alternative install disc for i386

4GB Pendrive is the only drive in the system.
2 parititons 256MB /boot, rest is / both are ext3

Install complete successfully but grub is not installed to mbr or to active partition. It is NOT installed at all. I know this because i start with brand new clean USB pendrive formatted to fat.

If i alt-f2 before system reboot after install and chroot to /target.

grub> root (hd0,0)
grub> setup (hd0)

 works fine.

However the grub-.log file shows that grub-installer failed on invalid device for (hd0).

So, i hit <Go Back> and have to install lilo which installs fine and gives me a bootable system.

I've attached all /var/log/installer/* files.

This is a very critical bug because I am shipping out boxes with usb drives as main drives and am unable to get grub to install on them.