Yeah I think they are probably going a little overboard there though USB flash is cheap enough I could see them using something like for storage on the controller. The profile on the controller thing is pretty awesome in itself as it basically would allow you to carry your profile with you to a friends house rather then hacving to bother anything about signing in.
Yes, the Kotaku leak mentioned that the controller is associated with the current user login.
I would be surprised if they have memory in that controller. If they go there, it's would be a very interesting play. ^_^
FWIW, I remember one of the Sony execs mentioned that the controller light is for player identification only. The color light may not used in the same manner as the Move controller light ball.