Just speculation, but would it be possible to dual boot OSs or firmwares on the PSP? Like if the firmware stored in the flash (3.40 OE for example) was modified so that if L and R were held during boot, it would boot the firmware from the memory stick. If the firmware on the memory stick is non-existant or corrupt (due to a memory stick format for example) then the PSP just returns an error and boots from flash.
I was thinking this may open a gateway to Linux on PSP etc.
I'm fairly inexperienced in coding so I don't know if it's possible.