LISH seems to be unable to display GNU screen based interfaces such as the GRUB boot menu. On the other hand, GLISH will display the GRUB boot menu successfully but will not respond to arrow key based navigation.
Here's our guide on installing a custom distribution to a Linode. If your image is stored locally, you could transfer it to the "Installer" disk via SSH by following this guide — accordingly, make sure you configure this disk with enou