4GB SD cards already supported and SDHC coming
I have one of these and I can confirm 4GB SD card works fine. I picked mine up for £179.99 for a 4GB model with a 4GB SD CARD free (do a search on google for D2). That's 8GB!! which is still not the cheapest, but it's the most amazing player I've ever owned.
SDHC support for cards up to a theoretical 32GB is coming in the next month or so! You can pick up 8GB SDHC cards for about 45 pounds or so now!!
Mine came with a transcoding software called JetAudio VX that converts most videos down to the XVID/WMV format that the D2 takes and it looks fantastic.
Worth every penny!! Don't be put off by the price, this things beats the nano on every count and it looks the business.