If one has an EFI system it supports booting the USB drive, but it does nothing with BIOS systems.
Regardless I suspect your system is using EFI and by not having the EFI folder on the USB drive when you ran the Install is why it's failing to boot.
The space it takes in minimal, you do not have create a separate partition, and it allows you to boot the USB drive on other systems, whether they are BIOS based or EFI based. And should you get a new system which is EFI based it will work on it without having to remake the USB. It works on both my netbooks, one BIOS based one EFI based.
The Porteus install instructions for the USB are the same. But booting is a whole lot easier for Porteus and many other Linux systems whether harddrive installed, USB installed or simply the ISO files.
Added in 6 minutes 39 seconds:
In rereading the prior posts I just reread this sentence. "one other EFI folder"!!! What other EFI folder? Where do you see it?