"A way of imagining this is with two sheets of transparent overhead projector paper – the bottom sheet is your read only partition, while the top sheet is your user partition. Using your marker pen, you write something on the top sheet, while everything that is written on the sheet underneath is still visible through it – giving the effect of a single sheet. Simply replacing the top sheet with a fresh one is all that is needed to bring you back to the beginning.
The downside to this method, apart from a slight overhead, is that performing large updates (such as updating OpenOffice) will take up a large amount of space. Replacing 300MB with 300MB of updated files means eating an additional 300MB out of your user space, rather than replacing the originals.