From: http://www.knoppix.net/forum/viewtopic.php?p=117323


LABEL KNOPPIX 
  MENU LABEL Launch Knoppix 5.11a 
  KERNEL /knoppix.511/linux ramdisk_size=100000 init=/etc/init lang=us apm=power-off vga=791 nomce quiet bootfrom=/dev/sda1/knoppix.511/*.iso config=scan home=scan ramdisk=32768 noprompt noaudio 
  APPEND initrd=/knoppix.511/mini511a.gz 
  TEXT HELP 
  Runs Knoppix 5.11a from ISO 
  ENDTEXT


The key to my problem seems to be that Syslinux can't find the minirt.gz file it it has a LFN. 
Using the original minirt_511a.gz didn't work (regardless of location), 
but renaming it to mini511a.gz worked fine (again regardless of location). 
