is encrypted linux 16 GB usb flash with electrum considered as a hardware wallet?
Not exactly.
When you connect this USB to the computer and connect to the Internet, you create new private keys using electrum wallet in a secure environment and not offline.
This is the problem. A small mistake can make you lose all your coins...
Unless you are very experienced and you know a lot of stuff about internet security, it is safer if you buy a hardware wallet.
A hardware wallet is an airgap environment. The keys never leave the device, the keys are generated inside the device and you see the keys (seed) in your device led visor. It is a lot safer than what you are doing.
Those hardware wallets are not very cheap, but they are not expensive. If you hold more than a thousand dollars in crypto, I highly recommend buying one, specially for newbies.
You won't be hacked using a ledger or a trezor, they are safe to use.