Actually depends on what you are doing. if you have under 2 gigs of hacks you can create a virtual SD.raw image file. drop it in /users/wii/SD.Raw. under settings make sure that the SD setting is checked. you can then run it just like a 2 gig SD in the wii. (dolphin is hard coded to only read that much)
If you have more files then 2gigs you will need to edit the ISO to add them in. i believe there are a few tools that replace the outdated wiiscrubber. like wiims ISO tool, or partitionbuilder 1.1 (i think thats the right version) can rebuild an ISO faster.
Currently I am using Brawl Builder, but I think I will start using a custom sd card. Thanks