Having looked at the TSA documents in the EPIC lawsuit, the TSA operational requirements are that the machines must be incapable of storing the images.
Not that this makes me any more OK with subjecting myself (and inflicting upon others) what is essentially a strip search.
The machines are capable of storing images. Straight from the mouth of Gale Rossides, the Deputy Administrator of the TSA [1]. The functionality is supposed to be disabled after an install, but such safeguards seem tenuous at best.