@jensvanhoof: To clarify, the osm files do not contain any imagary - they contain the raw information needed to create the imagery. GMaps is designed to work with pre-compiled imagry. So to go from an osm file to GMaps you need to do the intermediate step of transforming that raw osm data into mapping tiles.
Most people opt to simply use the pre-fetcher that radioman has included with GMap to pre-fetch imagery for an area and then include it in their application. Exactly as you said. Note that it will be significantly larger than 170MB.