from /usr/bin/livecd-iso-to-disk FAT limits: http://en.wikipedia.org/wiki/File_Allocation_Table -thanks-
The limit was put there after a few reports of corruption with larger sizes. I'd rather be safe than sorry in this case, sorry.
how long time ago ? OGAWA Hirofumi <hirofumi at mail dot parknet dot co dot jp> VFAT/FAT/MSDOS FILESYSTEM maintainer says: "This was fixed long time ago. However, > 2G can handle only on FAT32 because of fs limitation." -thanks-
ping... OGAWA Hirofumi(DOS FS kernel maintainer) said the bug was fixed time ago. And the limit already was deleted by liveusb-creator since 2009-03-08, release v3.6 -thanks-