I think they want to include video as well as still images Klaus.
ComputerAngel, carefully consider the amount of data you are proposing to handle, it is not a trivial amount. Assuming you wish to use color, the need is for at least three LEDs per pixel (red, green and blue) to produce anything like natural colors. The number of pixels is the horizontal resolution multiplied by the vertical resolution and for video you have to multiply that by the number of frames per second. For each LED you also have to store and reproduce multiple brightness levels, you can get a reasonable picture from 8-bits (255 levels + black).
Example: 720x576 resolution means 424,720 pixels or 1,244,160 LEDs. For reasonable motion in video you need at least 25 frames per second so your MCU would have to retrieve the image, decode about 31 megabytes of data, and send it to the display every second.
A PIC16 is a powerful processor but unless you want very small, low resolution images it isn't really suitable on it own and Andre's advice about using a small Linux PC is very good. With the aid of storage controllers, mass storage and hardware accelerators it is feasible.
Brian.