I was wondering if there is such a thing as a non-bootable operating system that can be run from USB without having to reboot the computer?
I can think of two possible solutions to your problem.
1. There's the "instant-on" OS Splashtop:http://www.splashtop.com/It's bootable though, so that's probably not what you're looking for.2. There's also the option of doing a virtualized installation of a mobile operating system. Virtualization will allow you to use an operating system within an operating system. For example, if your primary computer is Windows 7 (and it can be any OS), you can install Linux as a virtual installation. A virtualized installation can be run from a flash drive using a self executing, USB-ified version of VirtualBox. A handy feature within VirtualBox is something called "save state" which allows you to load up a snapshot of your from wherever you last left it, so there can be no loading.
If you run something without booting while one OS is already running, It can only be an the application supported by the current OS.
So all you can do is using an application that allows you to run another OS.
you will have to manage it with tools like @fragg3r:disqus mentioned.
May be virual pc (window 7 ultimate and pro) and Microsoft Virtual PC 2007 for windows xp can are also other options.
If your host system is always a Windows PC you might be interested in MojoPac.
One could say it's a Windows as an application but I recommend to watch the introduction video to better understand. While it states it is for Windows XP there are a lot of positive reports about using it in Vista and 7 systems.
The only other option I can come up with is setting up a portable virtual machine environment. However since most VM applications need to be installed and/or run at least as administrator this could prove rather difficult.
I can't really give you any pointers there since I have never attempted to do it but I guess someone around here or Google does have some answers on this.
There are plenty of operating systems that can be run on a USB, most notably Linux distributions. However, I'm not aware of any that don't require a boot. I'm not aware of any operating system / distribution that does not require a boot, however this is completely subjective as it depends on your hardware. Most (all) hardware require that a Power On Self Test initiated by the BIOS to make sure all the hardware is in check, this process alone would be consider part of the boot, so no.
Even if you could bypass POST, your computer needs to know which operating system to launch into, which is done via a boot manager. You can read more about the boot process.