Thumbnails get generated because most cameras are outputting multi-GB JPEG/RAW which take too long generate in real time on low end Macs whilst scrolling the thumbnail view.
And Apple apps don't go to great lengths to hide photos. They are stored in your Pictures folder in a package e.g. Aperture Library. Just right click and your photos are there. Packages are great for inexperienced users since it is easier to backup and less opportunities to mess up the metadata.
I thought most camera JPEGs contained a thumbnail in the EXIF. And there's absolutely no reason to store 1024x1024 "preview" versions either, or whatever it is it is doing to to take up so many gigabytes. Last time I looked at iPhoto, there were no obvious ways to move images around volumes (in fact, there were no obvious ways to even have folders within folders) (actually - i don't think it even supports folders; the "albums" it generated seemed to be only stored in some opaque hidden meta-database? Talk about lock-in!)
Handily, Aperture lets you use the camera generated preview from the EXIF.
Aperture and iPhoto use same library DB packages now, and Aperture's a cheap upgrade if you've outgrown iPhoto's consumer family interface. Aperture lets your organize any way you want, to any depth, with nesting of any kind within any kind.
It is up to individual cameras to support thumbnails and the resolution either way is postage stamped. The large 1024x1024 previews are for the large thumbnail view of your photos/albums (try it in iPhoto and you will see).
And the metadata is stored inside the iPhoto/Aperture library package. For Aperture at least it is an open standard XML file so there is no 'lock in' what so ever.
Ah yes, I'll just tell my mom to write an XML-parsing script to move the files around in case she ever changes her setup. ;)
And even Finder quicklook seem to render the full .jpegs just fine and fast enough, so wasting so much disk space on a useless preview/thumbnail feature (to me) is a dealbreaker. I'd even be willing to accept missing or postage stamped thumbnails, rather than having to uninstall applications and remove music to make room for my photos.
Personally, I like that Aperture (and iPhoto, for that matter) use packages instead of folders. It took away my desire to be a "file location control freak" and just focus on the photos.
Other enthusiast friends of mine hate the package approach because they're very used to the file management approach, so YMMV.
And Apple apps don't go to great lengths to hide photos. They are stored in your Pictures folder in a package e.g. Aperture Library. Just right click and your photos are there. Packages are great for inexperienced users since it is easier to backup and less opportunities to mess up the metadata.