Thanks for the reply aries, by removing the modules folder contents, my ps3 recognises the usb with MvC2 game on it. Although it does not boot into it, just has a black screen when loading it.
Good luck with the testing, i might wait this out until more news arises.
For those that have not had much luck with getting usbloader booting at all, make sure to copy the BEDATA-SYSTEM (or BADATA-SYSTEM for NTSC) over to the virtual memory card. I already had a version on there when i tried getting the SNES working awhile back and didnt bother replacing it, which caused problems.