How much experience in verilog do you have? You are in for a lot of pain... you will need to write a SD protocol handler (hint: use the SPI protocol, it is a lot easier), a filesystem controller, a picture file reader / decompressor and a LCD output controller. It is not exactly impossible, but extremely difficult without a CPU and some software (and not an enjoyable experience, I'm sure).
I too have the exact same project to work upon, only difference is that i have to perform image processing on the image and that i am using a de0 - nano board to implement this. I have made a VGA controller. Currently I am working on SD RAM controller and SD CARD controller. One thing i would advise is to convert the image file into a simple binary file which you can read far more easily. This conversion can be done on computer and after that the image can be written on the SD card. This will allow you to bypass filesystem controller and file reader / decompressor.I would really like if you keep posting your progress, i am sure we can help each other out