I’ve said it before and it’s worth saying again. Apple is building the Disney computer network. All the streets are clean, and the entertainment too. There’s no porn here, and as long as there are no ports it’ll stay that way.
Decreasing the amount of storage inside the Apple TV is interesting, but sort of obvious once you think about it running iPhone OS. No iPhone OS device has ever supported hard disk drives, and I doubt they ever will. And solid state storage is expensive. It’s all about streaming and caching. You’ll get Apple-sanctioned content from the iTunes Store, but I’d wager you’ll be able to stream any H.264 content you want over the web, or from any Mac or PC on your home network. You won’t need USB ports to watch porn; you’ll just need Wi-Fi. You won’t be limited to iTunes Store content any more than you are with the existing Apple TV today.