Hello ijohndoe
I have it installed on the IDSDM of one of my R720s. When I was initially performing the installation I wasn't really paying attention to the device I was installing to and had the same problem you are encountering. The problem was that it presented the Vflash from the iDRAC as a possible install location. It was the first option in my list so I selected it and installation failed shortly thereafter. I would suggest that you make sure you are selecting the USB in the IDSDM and not Vflash as your installation point. If that is not the case then there may be a problem with your USB devices.
Thanks