I got the New Ninja Bomber a PSP for his birthday.
It's now set up to access the Internet wirelessly in my office and at home, and with a selection of his photos, video and music as well as downloaded games.
This was however a pain in the neck for both me and The Profit Burglar. We had to upgrade the OS and reformat the memory stick before the web browser would work properly, and the text entry system (modelled on SMS) is an abomination that surpasseth all human understanding.
If you attach it to a PC via USB the device is simply mounted as a drive. Henceforth I'm going to manage it from there, and download from http://uk.playstation.com/psp/ etc. onto the desktop rather than directly to the PSP.
For all these travails however, I can see that the next generation of a PSP type system may become indispensable, that removeable storage is on its last legs, and that ubiquitous wireless access will change the landscape fundamentally.