CVG did an interview with a Nintendo UK Rep and here is a part of it:
CVG: There are concerns regarding Wii’s relatively small internal memory being filled by all this content (as well as VC games). Is this a concern for Nintendo?
Nintendo: Games can be saved on the internal memory or on SD cards - Wii Software games will come in a variety of sizes, but Nintendo encourages smaller, compact games for the service.
CVG: Will the games be playable from SD card, or will they need to exist on the internal memory, like VC games?
Nintendo: WiiWare is stored in and started up from the Wii internal flash memory so they would need to be transferred from SD like VC games.
However like VC games you can delete a Wii Software game to make room for other content, then re-download it at no cost.
CVG: Is Nintendo considering releasing a hard drive to bolster the Wii’s memory for all this new content?
Nintendo: No
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