Strictly speaking, SQS does not necessarily store data on disk and being highly available and fault tolerant does not exclude one from operating a completely volatile data store. Indeed, SQLite itself has an in-memory option which, when appropriately architected, could be used as the primary data store for a highly available and fault tolerant queue.
Having said that, I think it is safe to assume that SQS probably stores information to non-volatile storage.
First, the project does not yet have a distributed implementation, you’re correct. Stay tuned!
Second, SQLite is incidental. Data is still stored on disk, just as SQS must be, but I’ve chosen SQLite as the file format for now.