Modern flash carts like EasyFlash and clones allow for absolutely cavernous cartridge images. As good examples, see the C64 ports of Prince of Persia and Eye of the Beholder, which run entirely from massive cartridge ROMs.
But the cartridges themselves contains gigabytes as you say.
Of course everything can be put on cartridge (fast) or a diskette (slow loading). If they decide on cartridge, correct me if I'm wrong, it won't work on emulators, right? Also characters and animations must fit in memory too. There are so many technical barriers to be sorted out aside from the backgrounds. That's all what I am wondering about.