Use Rufus to create a bootable USB install flash drive from the ISO image file.
http://support.citrix.com/article/ctx116673
To mount an external storage device in a XenServer Windows virtual machine use the following steps:
In a pinch, you can use
/dev/sdx
formatted device names.
xe sr-create type=lvm content-type=user device-config:device=/dev/disk/by-id/usb-<your-device> shared=false name-label="USB L1 Backup Storage"