Everybody I knew had a PS1, a chipped PS1. Most (if not all) had atleast one Crash Bandicoot game, if not multiple. Piracy probably did ND out of $2000+ at my school...
I don't know if this phenomena was consistent across the lands, though. I remember hearing parents talking about it, and many refused to buy their kids consoles unless they got them chipped (could not justify £30 a game).
Times have certainly changed, though. In fact, I don't know a single person who has chipped a console since.
Emulators were pretty massive, too... though this mainly effected Gameboy and Gameboy Advance, at the time.