Yes, at some point I had four partitions on 2GB card (1xFAT + 3x ext3) and booted all three OS200x systems from mmc. All of them use same kernel and initfs so there is no problem (unlike with N800 and 2007 vs 2008).

The internal flash is slow and small so I see no point in having 'normal' system there at all. I use it only for recovery, when I need to remove the card or after full firmware reflash before copying it to mmc.