Hi,
Please see the answer for Q1 and Q2
Here LPC2468 Memory is not a matter since if you design the OSD using Blimp tool, then the OSD design sources which includes characters, pictures etc is loaded in to the external SPI flash and all the data is transferred from SPI flash to DDR2 memory at a time. Here DDR2 Memory speed has 250 MHz, so the picture data transfer would be fraction of second and it would be very fast
For your Picture Generator test equipment project all the requirements can be possible. You can use OSD Image component in blimp tool and can show different patterns as you said and can display it one at a time. Please refer Blimp user manual and Blimp ADV 800x Framework manual that will give you clear picture about it.
Best Regards,
Jeyasudha.M