I had considered enumerating the directory, but that could have serious performance problems if there are a bunch of images in that folder for whatever reason (e.g. the user just throws all their stuff into the root directory of the SD card). I talked to Dave Hylands about this, and he suggested doing it this way, since it avoids the performance issue and should still be fast since a lot of the information is cached.

As for the particular names I chose, I'll add a comment, but I grabbed the names from looking at forum posts for other mp3 players and seeing how people stored art for their music libraries. It might make sense to add .png versions too, but I haven't seen as many examples of people using PNG.