The Samsung Gallery has 8GB, but that's pretty unusual.

I have a feeling you may have the situation backwards. Until 2.2 (excluding rooted phones), all apps have been installed in internal memory.

Your comparison is poor. If there were no speed difference between DVD-RW and a hard drive, why wouldn't you want to use them? It allows easy upgrades and the ability to swap out data if you're not able to upgrade enough. As opposed to a device that only has soldered-on memory, where, when it's full, you get to delete stuff. (And I'm pretty sure that hard drives are not soldered to motherboards these days.)