The problem isn't really the price, the problem is that the PSPGo said something like "throw your UMDs away and go buy your games again at full price :)". I am happy with my PSP 3000 and my UMDs (btw, I will have to update my games here).
What's the big attraction in the new PSPGo? Smaller screen, no UMD support and you can buy online at high prices even if it should be cheaper than buying games from normal stores? I don't think it's cool...
A new color for the PSP 3000 will sell much more than the PSPGo. The Japanese are consumerist, they will buy a new revision/color for the PSP or DS because that's what they do best but PSPGo is simply a step backward in my opinion.
Let's take a look at some japanese numbers:
12/14 - 12/20
[PS3] 237,086
[Wii] 191,915
[DSi] 95,227
[PSP] 79,194
[DSi LL] 75,241
[DS Lite] 12,879
[Xbox 360] 8,965
[PSPgo] 3,260
[PS2] 2,982
What should I say? I am not hating on the PSPGo, I actually think the normal PSP is an excellent system and I love it but Sony made a bad move with the PSPGo.