Yes, you aren't understanding emuNAND or it's purpose. emuNAND pretends to be the internal storage of the switch. A switch, like let's say mine. It has 32gb of internal storage and 128gb sdcard. The sysNAND uses the 32gb of internal storage, but when I'm booted up in emuNAND mode it looks at a specific 32gb section of the sdcard and is tricked into thinking that 32gb of sdcard memory is in fact internal storage. So, you aren't just limited to putting save game data there. When you install a game to the internal storage while running emuNAND you're actually installing the game inside that 32gb of reserved space.
In essence, the emuNAND isn't really "wasting" any storage at all.
Also to clarify, no, emuNAND cannot "just read from internal storage" as you suggest. When you are running booted up as emuNAND the internal storage of your switch is not touched at all. That's why people are sure you cannot be banned for actions you take offline in emuNAND, they literally do not effect anything inside the internal storage of the switch.
To be clear.
If you are starting with an 128gb empty sdcard and you think that's enough storage, using emuNAND shouldn't really change your opinion at all on if the size is right for you. Wanting to use emuNAND isn't really a reason to need a bigger sdcard (although you will need one bigger than 32gb, which yours already is). Wanting a large library of pirated games to be available at all times? That's a good reason to want a bigger sdcard. You might as well use what you have though, it's plenty big enough, and in a few months if it's too small you can always migrate/upgrade to a larger sdcard. As I said before, you can't simply copy/paste an emuNAND to a new sdcard but hekate does have an option to migrate to a new sdcard. And the files other than the emuNAND can be copy/pasted.
