I booted Linux off of micro SD Card but it seems as if the Android in the onboard memory is no longer there.
Does the Linux off of the micro SD Card erase the onboard Android OS?
No. If you remove the sdCard the board should boot Android from flash again.
The only exception would be, if the system on the sdCard purposely overwrites some of the flash.
The standard Olimex images don't do anything to the flash.