I have to admin that when I discovered this little trick I got very excited and hopefully someone reading this will get too.
First of all we, as in my university, do not provide to our end users the installation cd, dvd, usb or recovery partitions. So we basically remove the physical installers from the boxes before deploying and now that there is no physical copy we remove the recovery partition and this as we are the biggest Mac base in the middle east this makes up have a ton of these sitting in boxes.
When I say the little MBAir usb drives I thought that if at some point they where formatted there should be a way of formatting them again and use them. So after googling a lot I found a Chinese tool called SMI Mass production tool. This tool supports up to 16 USB ports and seems that was designed to be used in factories to format drives massively.
Basically you open the tool, click on scan with the device connected, and once found you click on start. That is it. After few seconds you will get a green icon and your USB drive is now back to be a mere drive that you can format it as you wish.
The tools only works in Windows and you can download it here.
Usually these drives are 8GB in capacity and quite fast.
Once you are done there are many possibilities for the drive. You can put a bootable OSX in the drive, restore a DeployStudio netboot set, put a InstallESD.dmg (maybe a 10.7.5 with support for all the current hardware or one that includes your local users), or as we use them you can put the ASD to troubleshoot computers when there is a hardware