You need to make the partition active on the thumb drive to be able to boot from it... you can do this from an Elevated Command Prompt (Administrator mode) using Diskpart.
Open the Command Prompt by right clicking and selecting Run as Admin then type the following commands (make sure there is no info on the USB stick you want to keep)
select disk # (replace # with the number of the thumb drive in the list)
create partition primary
select partition 1
format fs=ntfs quick
after that, you can copy the contents of the ISO file to the drive and it will be a bootable windows installation media