I don't use an SD card so I don't know if I've got this completely right.
As far as I know, for books on the SD card the Kobo creates the thumbnail itself by extracting Page 1. I think it always maintains correct aspect ratio so if your cover isn't 3:4 you'll get the dreaded white stripes.
For books in internal memory if you're transferring books via Calibre then the KoboTouch driver (also covers Kobo Glo) allows you to configure whether to keep aspect ratio or not and also whether you want Calibre to create the thumbnails and send them to the Kobo when you send the books. If you don't 'keep aspect' and ask Calibre to upload covers then Calibre will create the thumbnails (3 per book) as 3:4 and send them, i.e. the Kobo will no longer need to extract the thumbnails.
I'm not sure I've explained that very well.
I don't know whether davidfor is planning to do more work on the Calibre device interface plugin so that SD book thumbnails work just like internal memory ones. Based on past experience if it's technically possible he'll do as much as he can for everyone.