I swung by Fry's tonight and found the perfect solution to my in-car USB problem. Since some of you were looking for a good solution I thought I'd pass this along.
Fry's currently has a sale on two versions of the A-Data ExpressCard/USB flash drives.
16GB $69.99
32GB $129.99
The drives are designed to fit an ExpressCard slot on one end (fast transfers if you have the right kind of slot) and and the other end has a mini-USB plug that fits a 6" USB extension cable that's included. It weighs only a few ounces and is 3" x 1.5" x 0.2".
The included cable is what finally closed the deal for me. You can never find them local and I didn't want to have to special order a short cable.
My plan is to pick up some velcro tape and stick it to the bottom of the outside of the center arm rest.
I wanted to avoid a spinning HD and don't need 40+ GB so this works perfectly for me. If you're looking for more than 32gb then you're still stuck with the USB hard-drive option.