Welcome to the forums!
I'm glad you've raised this issue, I think you've voiced a common question.
Android is all about choice, and Samsung has upheld that ideal that ideal to the highest standards where the SGS4 is concerned with storage choices (and no, I don't work for them lol).
First - a note about on-board storage - it's technically called flash memory, and it's the same exact technology as USB sticks that you may use for your PC, just like what you'll find in a separate sd card.
The built-in storage on your Samsung will always be superior to any sd card. Samsung leads the industry in mobile memory-storage chips - just as a point of reference, my last two HTC phones used Samsung storage chips - they're simply the best. They're the fastest and most advanced.
So, if you absolutely must have the highest-performing storage, you'll want to buy the model with it built-in.
When you buy an sd card it has a class rating - like class 6 or class 10 (the highest). That number is the certified rate, in megabytes/second (aka MBps) that the card will transfer data on writing.
Class 10 is way up there - 10 MBps. I use a 64 GB Sandisk class 10, and it's under-rated - instead of just 10 MBps, I get over 22 MBps download/transfer rates.
What do the numbers mean? The Blu-ray movie playback maximum is specified at 40 Mbps (note to HD fans, not talking disc here, talking movie rate) for full HD. In 2011, there were only 4 movies on the market at that rate. Most may have burst rates over 20 Mbps, but the vast majority of 1080p BD movies you may have average around 9 to 10 Mbps streaming rates. Divide by 8 to change Mbps to MBps and you get an HD max of 5 MBps.
So - if you absolutely must demand the highest-performance storage playback, you want a larger-storage SGS4 model. If it's a mixture, or you don't have those demands, going to a slightly slower class-6 card is for you.
Even though this is a 1080p phone - few will want to bother with the huge file sizes of Blu-ray movies on their phones. You can get perfectly acceptable performance by compressing those Blu-ray movies using a free solution like Handbrake, for example.
And if you're planning on just storing a boatload, the 64 GB model plus a 64 GB model is what you need.
If you do a lot of cloud stuff and don't use much storage - get the 16 GB model and forget about it.
If you want a good middle-of-the-road solution and aren't sure - get the 32 GB model, add an sd card later on.
I added a 64 GB sd card to my 2012 model phone because I had no choice - my only option (HTC model) was a 16 GB phone (not enough) and I didn't want to mess with storage, so I just went for the max. If you're like me on that, just get the 64 GB model and probably never worry.
I prefer using class 10 cards. I don't want to waste time writing to the card.
Those are my opinions on storage use - but the part about built-in memory by Samsung are facts though.
Cheers!