Hi kenstjohn,
I tried this with a USB flash drive and I was able to start the demo install. It's super slow, but progressing. I don't know if the issue may be with the lightning connection. Can you try it again and explain in more detail (step by step) how you are trying to install X-Plane? Does the installer work if you choose a different location, and it's only the external drive that has issues? How is it "failing" exactly (crash, hang, etc)?