I don't know much about programing or anything but from what i gather (just reading Daedalus changelogs) A lage part of the proccessing is converting textures, right? I remember readig that a newer version of Project 64 will support texture extraction. Is it possible to have them converted to PSP textures BEFORE you play it on psp? A PC application?
I saw a mod for zelda that gave it a more polished look by updating the textures, you can download the whole games textures.
I'm sure this isn't the first time its come up, just curious.
Granted I would assume the 30mb or so game would blow up to a few hundred, but I don't think many would complain. :)