This is definitely worth mentioning in anticipation of a faction overhaul. I'd also like to see faction emblems show up with the HUD indicators, at the risk of making the HUD overloaded with icons. Maybe implement a limit on faction HUD indicators to the x# (closest/hostile/biggest/most hp) contacts, client-configurable.
It's also worth mentioning size/shape limitations. Example: To allow easy GL integration and space constraints, the emblems might need to be limited to 128x128 or 256x256 square images. Size limitations can be important, because you don't want your battle with a new faction to be delayed while you twiddle your thumbs as the game downloads the faction icon. Talk about immersion-breaking. Storage of 1024x1024 or larger emblems will be much heavier than storing 256x256 emblems.
To answer questions:
Faction security can lead to faction-hopping (switching to another faction prematurely), and then possibly faction abandonment. At that point, it's simply a matter of more faction emblems that the server must store, even when those emblems are no longer used. With size/space limitations, unused emblem storage is less of a problem.
Maybe unused emblems can be offered for use if the faction they were loaded for is empty. It would be a shame if a really cool emblem went off limits when the last person leaves a faction. On the other hand, the game might need to implement some basic image-checking, to ensure that two different factions don't use the same emblem. That could lead to some direct pirate actions. Realistic, but frustrating in a game environment.
