Can you
 

Compile the source code of this on a bootable Live Linux CD? Knoppix to be exact or will it not work since it cant save any files?

You would need to have a valid linux root partition on you HDD inorder to save the config files, and to store the SQL database, so i am guessing no, if you have a high speed connection just do a full linux install via ftp to one of the sites, or goto www.linuxiso.org and download the ISO's.