Pictures can be transferred via USB stick to the picture frame as well as from the picture frame without any problems. However, you need an adapter cable from Micro-USB (picture frame connection) to USB A socket (USB stick connection). You can also get one at Digitec.ch. To make a USB picture transfer, simply use the corresponding commands as if you were using a microSD card: So for importing pictures "Manage photos/Import photos" and for exporting the picture frame photos "Save and restore/Save frame to SD card".
According to the manual, a connection to the USB hard drive can be established via USB, but this is only for service use (whatever that means, at least I have connected a USB line to the PC and nothing happens...can't see the frame on the PC).
Photo backups and downloading of photos can be done from a max 32 GB Micro SD card.