It really depends on what you're looking for in a portable system. Keep in mind the 3ds plans to release by march, and rumors seem pretty solid about a psp2 for the 2011 holiday. Right now the 3ds is $300 in japan and will probably be $250 in the US. No word on psp2 price but I wouldn't expect it to be under $200.
The DS library wins hands down, but that doesn't mean the psp library is bad. There's still enough games on the psp to justify buying it (if you like the games offered). The problem I have w/ most psp games is that they are attempts at console games on a portable system. I don't play portables the same way I play consoles. I'm much more likely to be interruptedplaying a portable so games where I have to pay close attention to live action sequences isn't what I want to play on my portable.
Games on the psp look way better than the ds. Graphically there is no match. The psp is a higher resolution, and has better hardware. If graphics are important to you then the psp is the better option. The DS has the touch screen which is amazing for some titles, and a gimmick in others. The psps controls are pretty much like the psp... a dumbed down console.
The psp is pretty good for media. If you keep a lot of videos on your computer, and know a bit about video codecs then transferring your videos to psp isn't that hard. If you're not there's probably a program that'll transfer your stuff for you, but it'll probably cost a couple bucks. It's screen is pretty amazing for watching videos, and reading comics isn't that bad. Overall the DS sucks for media.
The psp also has a web browser, and while it's not ideal it's better than nothing. Just don't expect every website to work, or work well.
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