Installing Debian wheezy from USB over serial console

I wanted to install Debian wheezy on a machine without a video card and no CDROM. I had a 1GB USB and I tried initially the easy way, as described in https://www.debian.org/releases/stable/amd64/ch04s03.html.en#usb-copy-isohybrid by just copying the cd image to my /dev/sda (USB stick) but I did not got any output on the console. I copied the iso file to another linux machine, mounted it as a loop device, made modifications in the isolinux.cfg file to redirect everything on the console, by adding the kernel parameters to look like below and then recreated the iso file but that still did not output anything on the serial console.

 isolinux.cfg

serial 0 9600
default install
prompt 0
timeout 100
label install
  kernel install.amd/vmlinuz
  append console=ttyS0,9600n8 initrd=/install.amd/initrd.gz --quiet

So I gave this up quite easy, and I took another approach. What I did next I followed the flexible way, as described in the debian documentation, but with some changes: 1/ I set up 2 partitions on the USB disk (/dev/sda in this example), both FAT16 (e code in fdisk), both 500MB and set the bootable flag on /dev/sda1 2/ pretty much followed the documentation and setup fat16 on /dev/sda1 and /dev/sda2:

mkdosfs /dev/sda1
mkdosfs /dev/sda2

3/ I installed the MBR on /dev/sda

install-mbr /dev/sda

4/ Installed the syslinux bootloader on /dev/sda1

syslinux /dev/sda1

5/ Copy the kernel and the initial ram image on /dev/sda1. This is done by mounting /dev/sda1 on let's say /mnt and the copying from the netinst cd vmlinuz and initrd.gz from the folder install.amd/ to /mnt (where I have /dev/sda1 mounted). Then I have created the syslinux.cfg file on /mnt according to the documentation and added the entries: