As a public service announcement, like many other I have found that the setting in GPEDIT.MSC: Computer Configuration / Administrative Settings / Windows Components / Search / Do not allow locations ... and the setting in the registry: HKLM\Software\Policies\Microsoft\Windows\Windows Search\DisableRemovableDriveIndexing have no effect whatsoever on this. Worse yet, by default GPEDIT.MSC is not available to Windows 10 Home users, and it takes a little bit of work to get it installed.
I also completely ignore the Microsoft party line that S.V.I. is an important folder and cannot be deleted. For my C: drive, and the other NTFS formatted hard dives in my computer this is indeed the case, and I would expect S.V.I. to remain on them and be correctly updated as I save restore points.
IT IS HOWEVER, COMPLETELY UNNECESSARY ON A USB DRIVE!
S.V.I. can and should be deleted from USB flash drives, it has no place on them.
There is a way to prevent its creation that appears to have no other adverse effects. Right click "Computer", select "Manage", double click "Services and Applications", then single click "Services".
In the right pane, scroll down and find "Storage Service". Right click, and select "Properties". If it is running, click the "Stop" button. Then in the dropdown labelled "Startup Type:" select "Disabled" This will prevent the unnecessary storage service from running, since it is responsible for creating S.V.I. on USB drives