I.e. not a file... that you create an additional, separate partition on the USB, of the same size as the ISO and dd the ISO onto that partition.

Perhaps you also need to have kernel and initrd available in the other filesystem, for that boot loader to work, but the installer will look for the ISO on partitions, not as a file.

Use the latest version of refracta2usb available here -
https://get.refracta.org/files/tools/re … ~4_all.deb
or here -
https://exegnulinux.net/files/refracta2usb/

1. You should start with a usb that already has one live system on it and was prepared using refracta2usb. I tried it with just the netinstall iso and it only worked for legacy bios boot. It didn't work with uefi boot and I did not investigate further.
See the fine documentation that comes with refracta2usb for basic instructions.
(Hint: click on Help inside the app or look in /usr/lib/refracta2usb/help_r2u.txt)

PREPARE THE USB STICK
Start refracta2usb, select the usb device and the select ISO_1 from the menu.
The contents of the iso file will be put into a directory on the usb. Give it a name.
Example name: freia-netinstall
Select the iso
Select the boot menu from the iso (for reference): /boot/isolinux/menu.cfg
Select the kernel: /boot/isolinux/linux
Select the initrd: /boot/isolinux/initrd.gz
Additional boot options: none here
Isolinux boot menu opens in text editor.
Remove live-boot and live-config options.  (i.e. boot=live and probably everything on the line after that.)
Add "priority=low" if you want Expert install.

Example:

label freia-netinstall
	menu label freia-netinstall
    kernel /freia-netinstall/boot/isolinux/linux 
    append initrd=/freia-netinstall/boot/isolinux/initrd.gz priority=low vga=788 --- 

Save and close the editor.

Grub boot menu opens in text editor. Do similar edits.

Example:

menuentry "freia-netinstall " {
    set gfxpayload=keep
    linux   /freia-netinstall/boot/isolinux/linux priority=low ---   
    initrd  /freia-netinstall/boot/isolinux/initrd.gz
}

Save and close the editor.
When the refracta2usb main menu comes up, you can Exit.

USE THE NETINSTALL
To use the netinstall iso, boot the usb stick and select the netinstall
from the boot menu. The installer will start and ask about locales and
keyboard, then it will fail because it can't find the cdrom.
Continue to get to the installer menu and scroll down to select
"Execute a shell"

In the shell, mount the first partition of the usb stick. And then
bind mount the netinstall directory on the stick to /cdrom.

Example Be sure to name the correct device! /dev/sdb1 is an Example:
You can run 'fdisk -l' in the shell to make sure the usb is the device you think it is.

mount /dev/sdb1 /mnt
mount --bind /mnt/freia-netinstall /cdrom
exit

This brings you back to the installer which should return to the menu.
Select "Detect and mount installation media"
and proceed with the installation.