Hey Sol,
PS2 did completely dominate down here... somthing shocking actually...
Although not the PS3. By the time the gen is all said and done, at max, it will have a 60/40 (PS3/360) userbase, (my guess is actually 45/55 - in 360's favour), plus the wii has practically 50% overall, thus will never dominate like the PS2 did.
A price drop will help in many ways, but it is now too late. Had it currently had a 60/40 userbase in it's favour, then yes it might just get that extra shelf space, but unfortunatly, it is currently selling 'less' then the 360 and it's been out for a long time now so I doubt it'll ever happen.
It's me... no really, it IS me!!!