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Yes, if you read its readme/faq, it references a 'setup8' install script. This will install it to the last 2GB of the E drive, leaving 3 available. However, there are a few issues with this.
It sounds as if it still could corrupt some data on your F drive. I ran setup8 before being aware of this, and it prevented the first game I ripped from running from the hdd. I re-ripped the game (yes, I own it) and then it worked.
Also, the xbox isnt really aware that the 2gb is taken up. So, if you rip a bunch of CDs via the MS Dash, or otherwise put files on E, it will eventually begin overwriting sectors which linux uses to make it unuseable.
For these reasons I've not yet installed xbox linux. I'm waiting for there to be virtual fileystem support, such as there was with "Eds Live CD .5"
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