I believe this limitation applies only to this particular build of 10.7, IMHO all C2D-equipped macs WILL be supported in final build.
It's really weird Dewroo is able to run 64bit kernel with his 5,1 iMac. Here are my specs from System Profiler:
Model Name: iMac
Model Identifier: iMac5,1
Processor Name: Intel Core 2 Duo
Processor Speed: 2.16 GHz
Number Of Processors: 1
Total Number Of Cores: 2
L2 Cache: 4 MB
Memory: 3 GB
Bus Speed: 667 MHz
Boot ROM Version: IM51.0090.B09
SMC Version (system): 1.9f4
I'm running the same model iMac. Also unable to boot from external USB/SATA drive. However, when I hold down the option key at boot to select a different startup volume, there are three choices: my internal drive, the Lion external volume that doesn't work, and a mystery "Recovery" volume, that will boot!
It boots to (presumably) Lion, although no proper Finder: I get a window with choices to restore from TM, reinstall Lion (won't work), use Safari to get help online (works!), use Disk Utility, use Terminal (several commands I tried don't work), or choose a new Startup volume.
So, Lion boots, but only in Recovery. Even more frustrating than not working at all. Seems like it's something we can get around, eventually. Or, support for 32-bit EFI Macs will come later on?