Oops. I forgot to restart my computer.
I knew something was up when my older external drive didn't show up as a bootable drive either under preferences.
I restarted my comp and now I have TWO, count 'em TWO, bootable external drives! Awesome!
Lesson to be learned is: if you want your external bootable firewire drive to be bootable, you must restart your computer after cloning the main drive.
I am so happy!
edit: next project: a new internal drive to replace the nearly topped out 250 gigger purring inside my macbook right now...