This kind of stuff is never really set in stone until it's announced, but a press release issued by eSOL announced that Nintendo would be licensing its PrFILE2 FAT file system and PrUSB/Host USB host stack middleware for the Wii. Human-readable translation (if you really want to call it that, since this is the English translation of the Japanese release): "By embedding PrUSB/Host, direct communication with USB devices is supported without using PC. Optional Mass Storage class driver enables using USB flash memory, other mass storage device and digital camera as the external storage." So eSOL's middleware can be used to address devices via USB, but it's still not a sure thing you'll be able to expand storage via USB on your console. Now, why you can only expand via SD is beyond us, but maybe Nintendo's wising up to the fact that maybe they can sell overpriced N-branded USB flash drives, too.