How to increase persistent file size for USB Ubuntu?

Hi,

I am running Ubuntu 8.10 from an 8GB bootable USB drive. The installation was achieved through a Live CD using the instructions available at http://www.pendrivelinux.com/2008/11/01/ubuntu-810-install-using-the-built-in-usb-installer/

The casper-rw file is currently defined with a size of 4GB and that's probably the max a single file can have on FAT32. After installing all the applications that I might need and after applying all the updates available, the size available from Home folder is around 450MB. However, the size available on USB drive is still around 2.5 GB.

Can I utilise the remaining space on the USB drive and increase the available space for Home folder?

I have come across a few posts on the internet that advise creating a home-rw partition along with the casper-rw partition. But not sure how/can that be implemented in the scenario I am in? As of now, there's only a single partition on my USB drive and it contains a file named casper-rw. Will adding another file named home-rw and making some config changes help? Or addition of some other file that can be used as an extention for casper-rw?

I would like to avoid re-partitioning the drive as I believe it would mean going through the complete installation process and will also need a redo for all the customisations, updates etc.

Any help will be appreciated.

Thanks,
Manan.