If your gonna blow the cash, get the PSP, it is a FAR more versatile gadget. You can play games, yes. But you can also browse the internet, wirelessly at any of the same hotspot type places you would with your laptop. (The original psp program didnt come with a browser, but Sony has added one now, you can view full pages exactly as you would on a pc, no cell phone type crap)
You can also watch movies on the UMD discs, which is really cool when your bored at work and tired of playing Battlefront 2. It uses the little Sony memory Duo cards or san disk cards of same exact type which atm go up to 2 gigs! You can dload entire movies to the thing, other video clips. Tons of music, do file transfers from pc to pc.
A very versatile device that Sony is still adding capability to.