Since you can install games on a flash drive on an Xbox 360, and flash drives generally have faster random reads than hard drives, would it give Xbox 360 games better performance by installing them to a (fast) flash drive instead of the traditional mechanical hard drive?
Xbox – Does a flash drive give better performance than a hard drive for games on a Xbox 360
hard driveperformancexbox-360
Best Answer
To the best of my knowledge, no. I haven't tested it myself, but I do know someone who didn't have a hard drive for sometime and relied on a USB drive. His stuff loaded significantly slower compared to when he finally got a hard drive. As mentioned in the comments to your question, USB 2.0 is likely to be slower compared to your Xbox's hard drive.
Now this isn't my personal experience, but from what I've read and heard from others, I believe your hard drive is the way to go :)