This got my attention. How exactly would they work this out?
It could all be done via a simple firmware update. I'm not exactly sure on how the copy protection worked for Sega CD and Sega Saturn discs, but I can assure you, they're standard CD-ROM discs, so at most, the drive itself would need a firmware update.
From there, the Disc channel would need an update to recognize Sega CD and Sega Saturn discs, and to properly initialize a downloaded emulator module from there, which would boot the BIOS of the emulated system. (Wii menu access MAY have to be disabled, as giving use to a native BIOS for a CD is different than other systems).
Emulation is simple, as that's how all virtual console games work. (They ARE emulated, they ARE NOT recompiled for the Wii's architecture). From there it could work out.
Alternatively, there could be a seperate channel for running Sega CD and Sega Saturn discs, although that's highly unlikely.
The Dreamcast is it's own bag, as the drive would be set to run CD, then from there, clocked to half speed to read the extra condensed data on the disc. So that would be a whole different bag, which would cause unneccisary wear on the drive. (Dreamcasts had notoriously bad life (remember the noise always coming from the drive)).
So it's quite possible, and it would require NO storage of the games. It wouldn't require shop channel support, however, so therefore they'd make no profit off of it, unless they charged for an initial download of the emulator.