It doesn't necessarily need to be a live obarun image, just a 2nd system that is making the image of the system in the specific partition. There is also need to be a space adequate enough (larger) to be able to store a copy of the filesystem while it is creating it. At the end of the run this space is automatically deleted. The result is an iso image that can boot from a thumb drive, a dvd, or be used in a vm.

You cannot make an instant copy of your system with obarun-mkiso. Do you want your personal data on the ISO like movies? This doesn't make sense (well, for me).
The purpose of obarun-mkiso is to create a valid/configured "base" system which can be booted from an e.g. USB stick.

So, install a fresh system on your host by mounting a fake device on e.g. /mnt, than use obarun-mkiso to make an ISO from this fresh installation. The obarun-install script it sufficiently flexible do make any useful system and obviously you can modify the system by chrooting the /mnt directory before making the ISO.

To help you, this following script will create a fake device at ./mounted directory. Then you can launch obarun-install picking this directory to install a fresh system

# !/usr/bin/bash

if [[ -z "${1}" ]];then
	echo "give a name for the image to create"
	exit 1
fi

create() {
	local name="${1}"
	
	# create an empty file of 5G
	oblog "Create disk image: ${name}"
	truncate -s 5G "${name}"
	
	# format that image
	oblog "Format: ${name}"
	mkfs.ext4 -m 1 -v "${name}"
	
	# umount the previous mountpoint in case 
	# of successively use of the script
	oblog "Umount mounted directory"
	umount -R mounted/
	
	# mount it
	oblog "Mount ${name}.img to mounted/"
	mount "${name}" mounted/
	
	# same as previous, in case of successive use
	# we erase the things done previously
	oblog "Delete mounted/{boot,home}"
	rm -rf mounted/boot
	rm -rf mounted/home
	oblog "Create directories mounted/{boot,home}"
	
	# finally create the boot, home directory
	mkdir mounted/{boot,home}

}

if (( EUID ));then
    oblog -f "you need to be root"
    exit 111
fi

create "${1}"

Well, to use it, change your working directory to e.g. ~/tmp/install. Copy this script to ~/tmp/install/create_disk.sh and make executable than launch it.
It will create a fake DD device of 5G. Increase it if you need more.

so, simply mount A at B/mnt and start obarun-mkiso and pick /mnt as mountpoint on obarun-mkiso menu. The A will be copied as it on the ISO.