I find a lot of articles on the web describing how GAE can be used as a CDN. But, I could not locate any mention about CDN in Google\'s documentation of App Engine.
Yes, GAE uses google's infrastructure for static content.
Have a look at this session at Google IO 2009 and read slides 24-28.
The static content is handled by specialized infrastructure. App runtimes don't serve them.
Using App Engine as distributed file hosting isn't really an "official" usage of the service, so that's why it's never mentioned in any official documentation.
App Engine apps are served out of multiple Google production datacenters, so in theory your app will serve requests (more or less) as quickly as GMail or Docs.
If all your app does is serve static files, then you've basically got a free (to a point) CDN built on Google's servers.
Some googling finds many examples of how to accomplish this.