I use Other OS. Have Yellow Dog 6.2 installed. I use it mostly for emulators, but it's also fun to dink around with for awile. I think it's crappy that Sony is removing this feature, as its one of the reasons I hunted down a 60 GB model. But, I can understand their concern about piracy. I mostly blame Geohot for being a douche and screwing it up for others who were fine with just improving the Linux that we already had on PS3.
I'm most likely going the path of the OP. Keeping my Phat at its current FW, and buy a Slim sometime in the future.







