I'm on the custom firmware version 3.40OE-A. I was playing the SCUMMVM emulator yesterday and put my PSP into sleep mode. When I turned it back on, the game I was playing froze and I held up the power button so that the PSP would turn off. I turned it back on and everything seemed fine (homebrew was working, PSX EBOOTs were perfect) until I tried playing a UMD game (Tekken Dark Resurrection). Before, all my games worked fine, but now I keep getting this error with many games (Daxter, Tekken, for example) and the weird part is that other UMD games work fine (Syphon Filter, MGS:PO). There's nothing wrong with the discs themselves because they work on my friend's PSP (just tested).
ANOTHER problem is that I get this same error message when trying to run PSP games in ISO form after disabling NO-UMD in the recovery menu. Before, all my UMD games worked and all my ISOs worked when NO-UMD was off, but now my ISOs only work when it's enabled. What the heck is going on?