what year would you be applying for? i.e., would you be trying to get into radiology residency for 08-09? or for the following year, which would be 09-10?
either way, you'll need to finish your pgy-2 year, unless of course you plan to sit out this coming year.
with that said, you'd have 1 year left of internal medicine at best; and at worst, you'd finish your internal medicine residency, and then go into radiology.
to me, it would make sense to finish the internal medicine residency, and then go into radiology. but of course, it's your decision, not mine.
first, and perhaps most importantly, you'll need to get approval from your program director to leave the program you're currently in. depending on your situation, this could prove to be rather difficult, or it could prove to be rather easy.
as far as letters of recommendation, it wouldn't make too much sense touse letters that were in support of your application for a position for internal medicine... to me at least. many programs may want a letter of approval from your program director- i.e. they want to know the terms under which you are leaving the program. also, programs want to hear about how you are as a resident, not how you were as a medical student. things change between medical school and residency, and change during residency- to the point where programs will be much more interested in hearing who you are currently.
personally, i haven't switched, but i know a few people who have. some waited until they finished the current residency (internal medicine into radiology), and others made the switch in the middle (switched after 4th year of optho into radiology). it takes a lot of due diligence on your part, especially navigating the waters without stepping on anyone's toes/ruffling any feathers.