I took a drive yesterday to Half Moon Bay (from east bay area) with version 9. I grabbed a 1GB USB stick laying around the house. I knew it wouldn't be big enough to capture the entire drive but I wanted to test the feature out. Formatted with Fat32 and put the TeslaCam folder in root.
Dash Cam triggered right away and started recording. I noticed about 3/4 of the way through the trip that there was an X on the Dash Cam icon. In essence, the USB stick ran out of space. The Dash Cam will not loop if it runs out of space before capturing enough footage for 1 hour of recording. I don't have any large USB sticks but I'm going to try an old 2GB today to see how it works.
I imagine that with future updates announced by Tesla & Electrek today
Tesla to improve its new dashcam feature with more Autopilot cameras and parking mode that larger USB sticks / drives will be needed in the future. I'll buy one with a smaller profile than the ones I have today. Many of the older 1 & 2GB ones I had lying around the house are too large to allow the console door to close properly and are just too small.
Great update Tesla. Keep 'em coming!