When you buy a MacBook Air, Apple packages an elegant little USB key that allows you to restore Snow Leopard if your machine troubles.
Here's a way to upgrade your USB Key to Lion as well as your MacBook Air.
First, Egg Freckles has posted a guide on how to create a Lion disc. Of course Lion will only be available from the App Store (or Dev site), but it's nice to have a local, external installer.
- Purchase and download Lion from the Mac App Store on any Lion compatible Mac running Snow Leopard.
- Right click on "Mac OS X Lion" installer and choose the option to "Show Package Contents."
- Inside the Contents folder that appears you will find a SharedSupport folder and inside the SharedSupport folder you will find the "InstallESD.dmg." This is the Lion boot disc image we have all been waiting for.
- Copy "InstallESD.dmg" to another folder like the Desktop.
- Launch Disk Utility and click the burn button.
- Select the copied "InstallESD.dmg" as the image to burn, insert a standard sized 4.7 GB DVD, and wait for your new Lion Boot Disc to come out toasty hot.
With this disc you can boot any Lion compatible Mac, and install 10.7 just like you installed previous version of Mac OS X. You can even use Disk Utility's Restore function to image your Lion boot disc image onto a external drive suitable for performing a clean install on a optical-drive-less MacBook Air, or Mac mini server. Clean installs with Lion are easy once you find where Apple has hidden the boot disk.
Second, MacBenTosh has posted a video guide showing how to format the restore key into a drive that works like a normal 8GB rewritable Flash drive. To follow along with the instructions in the video you'll need an instance of Windows running in a virtual machine, Boot Camp or a separate PC. After restoring, the key will be shown as a 8GB drive.