This id the following bug from the Debian-BTS:
https://bugs.debian.org/cgi-bin/bugreport.cgi?bug=820806

> -----BEGIN PGP SIGNED MESSAGE-----
> Hash: SHA1
>
> Package: grub-pc
> Version: 2.02~beta2-36
> Severity: minor
>
> Dear Maintainer,
>
> the information below is actually from my mobile-thin-client, I use to track current
> debian-testing software-updates, so it does not have too much to do with the promlem, I
> amtrying to address here. I attached three screenshots from the debian-installer, and
> also tried to setup GRUB manually to the USB-disk from the thin-client:
>
> > root@m100:/home/andrew# grub-install --boot-directory=/mnt/usb/boot/ /dev/sdb
> > Installing for i386-pc platform.
> > grub-install: error: hostdisk//dev/sdb appears to contain a ufs2 filesystem which
> > isn't known to reserve space for DOS-style boot.  Installing GRUB there could result
> > in FILESYSTEM DESTRUCTION if valuable data is overwritten by grub-setup
> > (--skip-fs-probe disables this check, use at your own risk). root@m100:/home/andrew#
> > grub-install --boot-directory=/mnt/usb/boot/ --skip-fs-probe /dev/sdb Installing for
> > i386-pc platform. grub-install: warning: Attempting to install GRUB to a disk with
> > multiple partition labels.  This is not supported yet.. grub-install:
>
> There really was FreeBSD on the USB-disk before, but it shouldn't really matter, should
> it??
> Also, when I install into KVM with virt-manager, and dd the image to USB-disk, it wil
> not boot either, see this report:
>
> https://bugs.debian.org/cgi-bin/bugreport.cgi?bug=819867
>
> The problem also affects Jessie stable, a non-BTRFS-partition is neccessary there also
> for being able to boot from USB-device, it seems to have migrated there.
>
> I would expect GRUB to be installable on USB-devices with any filesystem, supported by
> the installer, else I guess, the D-I team would have to disable the option to install to
> USB-devices, since they fail to boot afterwards.
>
> - -- Package-specific info:
>
> ********************* BEGIN /proc/mounts
> /dev/sda1 / btrfs rw,noatime,nodiratime,compress=lzo,space_cache,subvolid=5,subvol=/ 0 0
> /dev/sdb1 /mnt/usb btrfs rw,relatime,space_cache,subvolid=5,subvol=/ 0 0
> ********************* END /proc/mounts
>
> ********************* BEGIN /boot/grub/grub.cfg
> #
> # DO NOT EDIT THIS FILE
> #
> # It is automatically generated by grub-mkconfig using templates
> # from /etc/grub.d and settings from /etc/default/grub
> #
>
> ### BEGIN /etc/grub.d/00_header ###
> if [ -s $prefix/grubenv ]; then
>   set have_grubenv=true
>   load_env
> fi
> if [ "${next_entry}" ] ; then
>    set default="${next_entry}"
>    set next_entry=
>    save_env next_entry
>    set boot_once=true
> else
>    set default="0"
> fi
>
> if [ x"${feature_menuentry_id}" = xy ]; then
>   menuentry_id_option="--id"
> else
>   menuentry_id_option=""
> fi
>
> export menuentry_id_option
>
> if [ "${prev_saved_entry}" ]; then
>   set saved_entry="${prev_saved_entry}"
>   save_env saved_entry
>   set prev_saved_entry=
>   save_env prev_saved_entry
>   set boot_once=true
> fi
>
> function savedefault {
>   if [ -z "${boot_once}" ]; then
>     saved_entry="${chosen}"
>     save_env saved_entry
>   fi
> }
> function load_video {
>   if [ x$feature_all_video_module = xy ]; then
>     insmod all_video
>   else
>     insmod efi_gop
>     insmod efi_uga
>     insmod ieee1275_fb
>     insmod vbe
>     insmod vga
>     insmod video_bochs
>     insmod video_cirrus
>   fi
> }
>
> if [ x$feature_default_font_path = xy ] ; then
>    font=unicode
> else
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1 --hint-efi=hd0,msdos1
> - --hint-baremetal=ahci0,msdos1  1fd1c268-3803-45bf-b597-169e87e17e4a else
>   search --no-floppy --fs-uuid --set=root 1fd1c268-3803-45bf-b597-169e87e17e4a
> fi
>     font="/usr/share/grub/unicode.pf2"
> fi
>
> if loadfont $font ; then
>   set gfxmode=auto
>   load_video
>   insmod gfxterm
>   set locale_dir=$prefix/locale
>   set lang=en_GB
>   insmod gettext
> fi
> terminal_output gfxterm
> if [ "${recordfail}" = 1 ] ; then
>   set timeout=30
> else
>   if [ x$feature_timeout_style = xy ] ; then
>     set timeout_style=menu
>     set timeout=5
>   # Fallback normal timeout code in case the timeout_style feature is
>   # unavailable.
>   else
>     set timeout=5
>   fi
> fi
> ### END /etc/grub.d/00_header ###
>
> ### BEGIN /etc/grub.d/05_debian_theme ###
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1 --hint-efi=hd0,msdos1
> - --hint-baremetal=ahci0,msdos1  1fd1c268-3803-45bf-b597-169e87e17e4a else
>   search --no-floppy --fs-uuid --set=root 1fd1c268-3803-45bf-b597-169e87e17e4a
> fi
> insmod png
> if background_image /usr/share/images/desktop-base/lines-grub.png; then
>   set color_normal=white/black
>   set color_highlight=black/white
> else
>   set menu_color_normal=cyan/blue
>   set menu_color_highlight=white/blue
> fi
> ### END /etc/grub.d/05_debian_theme ###
>
> ### BEGIN /etc/grub.d/10_linux ###
> function gfxmode {
> set gfxpayload="${1}"
> }
> set linux_gfx_mode=
> export linux_gfx_mode
> menuentry 'Debian GNU/Linux' --class debian --class gnu-linux --class gnu --class os
> $menuentry_id_option 'gnulinux-simple-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio
> if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.4.0-1-686-pae ...'
> linux /boot/vmlinuz-4.4.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro  quiet echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.4.0-1-686-pae
> }
> submenu 'Advanced options for Debian GNU/Linux' $menuentry_id_option
> 'gnulinux-advanced-1fd1c268-3803-45bf-b597-169e87e17e4a' { menuentry 'Debian GNU/Linux,
> with Linux 4.4.0-1-686-pae' --class debian --class gnu-linux --class gnu --class os
> $menuentry_id_option
> 'gnulinux-4.4.0-1-686-pae-advanced-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi insmod
> part_msdos insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.4.0-1-686-pae ...'
> linux /boot/vmlinuz-4.4.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro  quiet echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.4.0-1-686-pae
> }
> menuentry 'Debian GNU/Linux, with Linux 4.4.0-1-686-pae (recovery mode)' --class
> debian --class gnu-linux --class gnu --class os $menuentry_id_option
> 'gnulinux-4.4.0-1-686-pae-recovery-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.4.0-1-686-pae ...'
> linux /boot/vmlinuz-4.4.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro single echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.4.0-1-686-pae
> }
> menuentry 'Debian GNU/Linux, with Linux 4.3.0-1-686-pae' --class debian --class
> gnu-linux --class gnu --class os $menuentry_id_option
> 'gnulinux-4.3.0-1-686-pae-advanced-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.3.0-1-686-pae ...'
> linux /boot/vmlinuz-4.3.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro  quiet echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.3.0-1-686-pae
> }
> menuentry 'Debian GNU/Linux, with Linux 4.3.0-1-686-pae (recovery mode)' --class
> debian --class gnu-linux --class gnu --class os $menuentry_id_option
> 'gnulinux-4.3.0-1-686-pae-recovery-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.3.0-1-686-pae ...'
> linux /boot/vmlinuz-4.3.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro single echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.3.0-1-686-pae
> }
> menuentry 'Debian GNU/Linux, with Linux 4.2.0-1-686-pae' --class debian --class
> gnu-linux --class gnu --class os $menuentry_id_option
> 'gnulinux-4.2.0-1-686-pae-advanced-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.2.0-1-686-pae ...'
> linux /boot/vmlinuz-4.2.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro  quiet echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.2.0-1-686-pae
> }
> menuentry 'Debian GNU/Linux, with Linux 4.2.0-1-686-pae (recovery mode)' --class
> debian --class gnu-linux --class gnu --class os $menuentry_id_option
> 'gnulinux-4.2.0-1-686-pae-recovery-1fd1c268-3803-45bf-b597-169e87e17e4a' { load_video
> insmod gzio if [ x$grub_platform = xxen ]; then insmod xzio; insmod lzopio; fi
> insmod part_msdos
> insmod btrfs
> set root='hd0,msdos1'
> if [ x$feature_platform_search_hint = xy ]; then
>   search --no-floppy --fs-uuid --set=root --hint-bios=hd0,msdos1
> - --hint-efi=hd0,msdos1 --hint-baremetal=ahci0,msdos1
> 1fd1c268-3803-45bf-b597-169e87e17e4a else search --no-floppy --fs-uuid --set=root
> 1fd1c268-3803-45bf-b597-169e87e17e4a fi
> echo 'Loading Linux 4.2.0-1-686-pae ...'
> linux /boot/vmlinuz-4.2.0-1-686-pae
> root=UUID=1fd1c268-3803-45bf-b597-169e87e17e4a ro single echo 'Loading initial
> ramdisk ...' initrd /boot/initrd.img-4.2.0-1-686-pae
> }
> }
>
> ### END /etc/grub.d/10_linux ###
>
> ### BEGIN /etc/grub.d/20_linux_xen ###
>
> ### END /etc/grub.d/20_linux_xen ###
>
> ### BEGIN /etc/grub.d/30_os-prober ###
> ### END /etc/grub.d/30_os-prober ###
>
> ### BEGIN /etc/grub.d/30_uefi-firmware ###
> ### END /etc/grub.d/30_uefi-firmware ###
>
> ### BEGIN /etc/grub.d/40_custom ###
> # This file provides an easy way to add custom menu entries.  Simply type the
> # menu entries you want to add after this comment.  Be careful not to change
> # the 'exec tail' line above.
> ### END /etc/grub.d/40_custom ###
>
> ### BEGIN /etc/grub.d/41_custom ###
> if [ -f  ${config_directory}/custom.cfg ]; then
>   source ${config_directory}/custom.cfg
> elif [ -z "${config_directory}" -a -f  $prefix/custom.cfg ]; then
>   source $prefix/custom.cfg;
> fi
> ### END /etc/grub.d/41_custom ###
> ********************* END /boot/grub/grub.cfg
>
> ********************* BEGIN /proc/mdstat
> cat: /proc/mdstat: No such file or directory
> ********************* END /proc/mdstat
>
> ********************* BEGIN /dev/disk/by-id
> total 0
> lrwxrwxrwx 1 root root  9 Apr 12 15:35 ata-CF_Card_2BDA07581F0100008062 -> ../../sda
> lrwxrwxrwx 1 root root 10 Apr 12 15:35 ata-CF_Card_2BDA07581F0100008062-part1
> - -> ../../sda1 lrwxrwxrwx 1 root root 10 Apr 12 15:35
> ata-CF_Card_2BDA07581F0100008062-part2 -> ../../sda2 lrwxrwxrwx 1 root root  9 Apr 12
> 15:55 usb-SanDisk_SanDisk_Ultra_A200476A92056043-0:0 -> ../../sdb lrwxrwxrwx 1 root root
> 10 Apr 12 15:55 usb-SanDisk_SanDisk_Ultra_A200476A92056043-0:0-part1 -> ../../sdb1
> lrwxrwxrwx 1 root root 10 Apr 12 15:55
> usb-SanDisk_SanDisk_Ultra_A200476A92056043-0:0-part2 -> ../../sdb2 lrwxrwxrwx 1 root
> root 10 Apr 12 15:55 usb-SanDisk_SanDisk_Ultra_A200476A92056043-0:0-part5 -> ../../sdb5
> ********************* END /dev/disk/by-id
>
> ********************* BEGIN /dev/disk/by-uuid
> total 0
> lrwxrwxrwx 1 root root 10 Apr 12 15:35 1fd1c268-3803-45bf-b597-169e87e17e4a
> -> ../../sda1 lrwxrwxrwx 1 root root 10 Apr 12 15:55 563228a77cd001ae -> ../../sdb2
> lrwxrwxrwx 1 root root 10 Apr 12 15:55 6395291d-49b6-4213-938b-5d3c0a67afe3
> -> ../../sdb1 lrwxrwxrwx 1 root root 10 Apr 12 15:55
> 83855bde-8a9b-4d76-959b-61f97943e47c -> ../../sdb5 lrwxrwxrwx 1 root root 10 Apr 12
> 15:35 d6de6033-738d-4c69-8ced-d46fa1977b66 -> ../../sda2 *********************
> END /dev/disk/by-uuid
>
> - -- System Information:
> Debian Release: stretch/sid
>   APT prefers testing
>   APT policy: (500, 'testing')
> Architecture: i386 (i686)
>
> Kernel: Linux 4.4.0-1-686-pae (SMP w/1 CPU core)
> Locale: LANG=en_GB.UTF-8, LC_CTYPE=en_GB.UTF-8 (charmap=UTF-8)
> Shell: /bin/sh linked to /bin/dash
> Init: systemd (via /run/systemd/system)
>
> Versions of packages grub-pc depends on:
> ii  debconf [debconf-2.0]  1.5.59
> ii  dpkg                   1.18.4
> ii  grub-common            2.02~beta2-36
> ii  grub-pc-bin            2.02~beta2-36
> ii  grub2-common           2.02~beta2-36
> ii  ucf                    3.0036
>
> grub-pc recommends no packages.
>
> grub-pc suggests no packages.
>
> - -- debconf information:
>   grub2/kfreebsd_cmdline_default: quiet
>   grub-pc/partition_description:
> * grub2/linux_cmdline:
>   grub-pc/install_devices_disks_changed:
>   grub-pc/install_devices_failed_upgrade: true
>   grub-pc/mixed_legacy_and_grub2: true
>   grub-pc/install_devices_failed: false
>   grub-pc/timeout: 5
>   grub-pc/install_devices_empty: false
>   grub2/device_map_regenerated:
>   grub-pc/hidden_timeout: false
> * grub-pc/install_devices: /dev/disk/by-id/ata-CF_Card_2BDA07581F0100008062
> * grub2/linux_cmdline_default: quiet
>   grub-pc/postrm_purge_boot_grub: false
>   grub2/kfreebsd_cmdline:
>   grub-pc/kopt_extracted: false
>   grub-pc/disk_description:
>   grub2/force_efi_extra_removable: false
>   grub-pc/chainload_from_menu.lst: true
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My screenshots please see there:
https://bugs.debian.org/cgi-bin/bugreport.cgi?filename=grub-install-failure-00.JPG;att=1;bug=820806;msg=5
https://bugs.debian.org/cgi-bin/bugreport.cgi?filename=grub-install-failure-01.JPG;att=2;bug=820806;msg=5
https://bugs.debian.org/cgi-bin/bugreport.cgi?att=3;bug=820806;filename=grub-install-failure-02.JPG;msg=5