Are you sure this USB is good? What brand? I've seen similar issues on poor quality USB sticks. What really sticks out as the USB may be bad is that you cannot run the "dd" command to write zero's across it. This should be successful no matter what. Also, you don't need to format the USB stick at all. So long as the installer sees it, it can be installed to (formatted or zero'd out). Do you have another USB stick you can use just to rule that out?
EDIT: You might also want to try and change your BIOS settings to use "Legacy" or "BIOS" as opposed to UEFI just to see if that solves your problem. In my opinion, there really is no need to use UEFI for applications such as FreeNAS.