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Storage requirement would depend on DPI. You're 'only' looking at ~10PB at 600 DPI. Then again you'd expect most everything to be procedurally generated anyways...
I don't see what your example has to do with multitasking. What you're asking for is a way to manipulate system settings from custom apps -- having the settings app run in the background just saves you a few 'clicks'.
Well not necessarily. If the 'sugar on a stick' build expects to be able to write to the stick, you'd need to add something like UnionFS in order to be able to run it from a cdrom. Not to mention that you'd need to setup something to keep users' settings in between reboots (e.g. a usb stick).
There isn't anything in the Toyota's owners' manuals about using glue as engine oil either. What's your point?