I have a slot loading iMac (Dalmation) with a broken CD-R drive (don't ask; my kids thought it was cool place for coins). I have been using a FireWire CD-R drive in its place whenever necessary. I could not install 10.2 from this drive since it did not power up until after the OS started to boot.
I connected my iMac to my G4 PowerBook with a FireWire cable. I then rebooted the iMac into FireWire "target" mode by holding down the "T" key when booting up. I then loaded my 10.2 install disk into the PowerBook and went through the regular install process, except this time I installed it on the FireWire drive that was the main drive on my iMac. It even booted into the new Jaguar running on the iMac but displaying the screen on the powerbook. I then re-booted the iMac, and after a couple minutes of searching, Jaguar loaded successfully and has been running strong ever since.
One side note is that I had to make sure to reset the startup disk on the PowerBook to find the original 10.2 on the PowerBook drive before re-booting the PowerBook. For some reason, it refused to find the original install on its own when I just rebooted. Even the key command on boot-up did not work. But this was no biggie, just remember to change the start-up drive and everything will be OK.
Mac OS X Hints
http://hints.macworld.com/article.php?story=20020913061228333