I think that this problem will continue to exist as long as there is a limited amount of space and motivation to use that space. As a long time PC gamer, there were many years where I had to manage my hard drive space carefully knowing that I could have that, that, and that on it but not this, this, or this. I'm used to it so it doesn't bother me or is, at very most, a minor annoyance.
My problem with PS3 game installation (if I owned one) would be installation time. When I sit down to play a console game, I want to play it and not wait for an installer to finish. If I want to rapidly switch from game to game (as I often do), I would likely need a bigger hard drive or be forced to manage my space and then do more installations later. Still, even on a PC at the height of things I don't normally do that many uninstalls/installs at a time.
Anywho, if I ever get a PS3 the first thing I'll be sure to do is put in a 100+Gb hard drive, but thanks anyway for the tip Onna. It may or may not come in handy, but it's a new option all the same.
