There are a few G1 users reporting that my app won’t display images. I can only imagine this is because they don’t have an SD card.
My app is heavy on images. Is it appropriate to store images on the internal memory? I don’t even know if there’d be enough space.
It’s not appropriate to store them on the internal memory. What you should do is check for the existence of an SD card and alert the user if they don’t have one telling them your app won’t work without it. See here for how to check external media availability.