usb - Ubuntu 11.10 - computer with no HDD

I'm new to Linux and Ubuntu [less than a month using Ubuntu 11.10].

this old machine i have:

amd athlon x2 64, 4gb ram
no hdd
no cd/dvd drive
usb pen 4gb with live cd [Ubuntu 11.10 i386]
usb pen 8gb --- intended as hdd
sd card 2gb --- with Ubuntu 11.10 i386 iso file
fast internet 25 mib/s

what im trying to do is:

• start computer with 4GB pen Ubuntu 11.10


• install Ubuntu in 8GB pen [not create a live cd]


• work from the 8GB pen with Ubuntu installed in it.

is this possible ?

if so, any tips how i go to do this ?