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Kwaad said:
tk1989 - PS1 games on the PSN range from 200mb to 650mb. Some of them dont compress at all. And the small ones... I dont think filled up the CD.

But what did they use the space for in the PS1 era?  Redbook audio?  MP3 it, problem solved.  FMV?  I don't think WiiWare games are going to be laden with FMV, these are indie developers we're talking about.

You could fit 20 100 MB games on a 2 GB SD card that costs you $25.  That's way cheaper than a hard drive peripheral and it's enough space.