I think this is an area where SD is actually fairly suitable - not for storing the actual OS for the console, but certainly for storing data files. They're mostly read only other than saves, which should be miniscule amounts of I/O, and ease of removal so you can copy more games on is very important.

I don't see any issue with using SD or microSD for that usecase?

edit: I don't think I/O performance for reads should be a big issue either - for most retro games you're going to be able to have the whole ROM in memory as even a 16 or 32MB GBA ROM is still tiny! For PS1 and newer, microSD read speeds are certainly faster than CD/DVD read speeds, too?

PCIe will probably eventually trickle down to even the kind of SoCs that go into those products, especially if M.2 NVMe becomes the preferred storage media for most other single-board computers. It'll be a long transition, since NVMe is only just starting to become viable as the primary storage for some SBCs, but I think it'll happen eventually. There really aren't a lot of reasons to prefer microSD unless you're using an SoC that simply doesn't have any better IO interfaces.