One observation during verbose boot directly from HDD, I see the kexts getting loaded from [hd(0,1)/System/...] partition, however when I boot from USB drive, I see the kexts getting loaded from [hd(1,1)/System/...] partition. This doesn't seems to be correct. Could you help me with this?
Few more lines prior to HDD boot freeze:
If you want to make modifications to files:
/sbin/mount -uw /
If you wish to boot the system:
-s flag triggers a superuser mode and you are actually seeing its proper output. Why are you booting with that flag and what are you expecting to achieve by it? Why use the cpus=1 flag? Also, what is in your USB/HDD org.chameleon.Boot.plist? Is there a Default Partition string in it?