Microsoft doesn’t want you fiddling with your fancy Windows Phone 7 and its storage. Why? The micro-SD you choose is probably going to suck, at least according to Microsoft. However they’ll let your carrier pick a good one for you… as long as they’ll support it.
From Paul Thurott at Windows Phone Secrets:
The issue, apparently, is the micro-SD card format. The cards are unreliable and inconsistent, even between batches made by the same manufacturer, and in Microsoft’s tests, there was no way to “certify” that any would work properly. “Even with high end cards, we have seen wild differences in IO and performance,” he said. “There is just no standardization there.” Put simply, if you expand the storage in a compatible Windows Phone device, it may work, and it may not. “In most cases, users will have issues,” he told me.
However, at least one carrier, and it’s not one you’d expect, is taking a laissez–faire approach to the whole thing. With AT&T Senior Vice President of Devices Jeff Bradley telling customers:
The devices will support the addition of up to a 32GB class 2 (or higher) microSD card. You need to insert the card before you power up the device the first time so that the operating system can map it as available memory to maximize its utilization. This is outlined in the Quick Start Guide you receive in the box. I encourage you to read this before you launch the device the first time to have the best experience with a microSD card.
So Microsoft says don’t mess with it, and AT&T, of all companies, says go right ahead. The best advise we can give is to pick a card from a solid vendor like San Disk and see what happens… caveat emptor