I think it'd be cool if the badges looked a little nicer. As it is now, badges are at the bottom of the user page, all smooshed together as colored bullet-points and text. Meanwhile, other sites are doing badges - Foursquare probably most notably right now, and even the Huffington Post. Each one is distinctive and beautiful. Some are funny and tell a story. It'd be great if Stack Overflow hired a designer to do the same thing, and instead of burying them on the profile, maybe put something like "most recent badge" near the top of the profile screen.
One thing I love about SOFU is that almost everything is pure CSS. The only images are avatars, the site logo, the editing, rss & envelope icons and maybe a couple of ads -- oh, and the adobe/android tags. This is the style of the four trilogy sites, very few images.
I think sticking a boat-load of images in just for badges would go against the minimalistic style the sites have. I am open to the style of badges being changed, although I do think they look fine as they are.