HappySquirrel pretty much summed it up (there is an additional problem with the PS2 ram architecture that adds to the problem. The amount of raw power required also heavily depends on the cpu structures, I remember a Mac emulator for the Amiga which sort of worked 1.1 since it had to emulate the same processor architecture). So the question is: Why would Sony invest a lot of time and a lot of money into something that could, at best, fully work with about 10% of existing PS2 software and approximately work with another 20% of software? Yes, companies have done stupid things but other than yelling "look what a cool thing we did - we can emulate almost 20% of PS2 software", there is nothing Sony can gain by wasting that time and money on an emulator (insofar as readding the PS2 GPU chip to the PS3 board probably costs less than $20 and gives you 99% compatibility, so there is even less incentive to do an emulator).
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