Though I never had a crash with external binaries up to now, but with Poser 7 SR3 at least this function is really useless.
There is a bug in, might be completely Poser 7 but with SR3 for sure. Poser is writing the morph to that external binary files (.pmd) but doesn't delete them from the CR2. So you end up with the double amount of drive space and maybe more time wasting cause the morphs are read twice.

In general I see no real use for the pmd-files. Not only cause of useful utilities as EnglishBob mentioned correctly but mostly cause poser is so birdbrained to place them directly into the library structure. So it's only a path reference more in the CR2 that have to be maintained by hand if you want to move that files to some intelligent placed by your own order. Everytime in that case I have the pleasure to push pmd's to geometry folder and to edit that cr2 ... :cursing:

And with creating a INJ pose file I have never seen the use of pmd files ...