oh hell yeah Rich! $10/cd... I'd buy 'em! Tiff or otherwise!
I mean, even at a Meg per image... that's still 600-700 per CD.
Just make sure you sell the CD copyright protected for personal non-commercial use only - although please don't put watermarks on the images. You can insert copyright notice into the file without it overlaying the image
As for the format (Tiff)... most of the raster graphics clip-art & Photo CDs I've bought in the past (as opposed to vector graphics) are all TIFF anyway.
It's "the standard" cross-platform format (Windows, Macintrash *nix).
So yeah, I'm all for TIFF
But, if you've got Photoshop. Once you've burned each CD. You can always do a "batch convert" of all the images on the CD to a new directory. Sell 'em in both formats. Jpeg (for the casual browsers of images) and TIFF (for those with decent graphics software)