1) You can put a larger harddrive in it, many have done it. For me, my music collection is about 12GB, so 20 is plenty (and I have about 2500 tracks)

2) The wireless is used to syncronize the drive, not to stream the music. Its only used for a few minutes to transfer new files found on your PC to the hard drive in your car. The music is played in the car FROM the hard drive.