CF cards are definatly cheaper for larger capacity. You can go to dell.com and buy sandisk 1gig cf card for $233.90 which = about 24 cents a meg. Buy.com has a 256 sd card for 69.99 which equals 27 cents per meg but that gets a lot higher for a 512 sd. I would buy the 256sd to have always installed and then use the cf for wireless or other i/o devices. The sd memory also uses less power so it is a good solution.
Link to buy.com 256sd card
http://www.buy.com/retail/product.as...=30421&loc=101
As far as installing programs to ram or external, It depends on whether you have the 64mb ram or 32. If the 32, I would install large applications like lextionary or other such programs with files that are a couple megs. Small programs like wisbar or hearts I would just go ahead and put on the machine itself. Things run a little faster on the ram.