Heres a guide i whipped up to show people how to convert videos to the psp format using PSPVideo9 (THIS IS ONLY FOR 2.0 AND ABOVE, IF FEEDBACK IS POSITIVE I WILL MAKE A 1.5 VERSION SOON)
1. Download PSPVideo9 from www.pspvideo9.com
2. Install PSPVideo9 and have your PSP plugged in, it should recognize it.
3. Go here and get the file, save it to your desktop.
4. Start up PSPVideo9
5. Click Convert on the right hand side.
6. Click transcode new video.
7. Select your profile from the dropdown list, i suggest AVC/368x208/29.97fps/384kbps Stereo/96kbps
8. Click start.
9. Let the program run (for small files it may only take a few seconds, but for movies it can take over 3 hours depending on your computer specs)
10. Click on copy on the left hand side.
11. Make sure its set to the avc folder as shown in the picture.
12. Drag your video from the pc side accross to the PSP side.
13. You are done!! You can now start the video from the video tab in the PSP menu.