The video above demonstrates that a jailbroken iPad can read a USB flash drive via the camera connection kit. The iPad reads the drive via the iFile App, available on Cydia and Installer for $4.
When attaching the USB drive you will get the error message that the device is not compatible, just ignore it and keep moving on. You also get that message when attaching a USB keyboard to an unjailbroken iPad, it‚Äôs no real issue.
You cannot read an external hard drive, the iPad does not have enough power, but most flash drives should work.