Did they only price cut the bad version of the system? I think the vast majority of people are only going to want the deluxe rather than the bad one.

yes because the price cut helped VITA much, games is what will sell it. 

No matter how low the price is, if there is nothing for the system to sell it then why buy it to collect dust?

Price isn't the problem so it makes sense that this would have little effect. The problem is the Wii.

Ya.....none were real blovckbusters at the time.

Just be honest, it coasted on PS2 brand loyalty until 2008. Any other brand console wouldnt have fared as well.

sorry but I don't see it that way.  Sure they weren't blockbusters but they were excellent games an sold decent.  I bought a PS3 because of R&C in 07.  My brother wanted it for Socom Confrontation.  We bought for games.  Not to mention it was the cheapest bluray player at the time.  Free online was a big incentive as I enjoyed COD4 for free in 07 as well (last COD I bought and the last great SP in the franchise unfortunately).  My friends bought it for Uncharted or in anticipation of FF13 or Valkyria Chronicles.  Take a look at WiiU to see how many sales brand loyalty gets you.  I think the $200 price difference was more than enough to get rid of brand loyalty (although those 360s ended up costing more if you played online because you've paid $400 for Live at this point).  Also I'm not saying it was the best console in its initial year on the market either.  It didn't sell well in that first year for a PS console, but they did some pretty quick price drops and of course no system has great games in the first couple months usually.  360 had Gears in 06, about a year after launch.  Wii got 3d Mario in 07, a year after launch.  WiiU will get some big hitters about a year after launch.  3DS got Mario and MK 6 months after launch.  PS3 didn't have enough great games in its first year, but I'm saying very few, if any, consoles ever do.  If they have (I don't know about launch window of SNES or anything old like that) then that was the abnormality.

We are forum gamers, the core of the core. Think outsiode your box. Think mass market gamer. You yourself admitted they werent blockbusters and thus not real system sellers at the time, despite them being critically acclaimed, which I agree. Which leads me to believe it sold on PS2 brand power....given how much PS2 sold, it isnt crazy to think this. But w/e, agree to disagree.

The games wont change a thing unless they have the casuals.

Wii sold a ton, but WiiU has done rather poorly.  Now I know Wii has slowed down and PS2 was still outselling current gen at the time, but still.  Also it should be noted that PS3 had its worst years when it didn't have games just like any system.  Also you seem to have completely ignored my point about all modern systems not really having anything right after launch.  PS3 had its worst sales in 07, its first year on the market.  That's normal but it also shows it wasn't selling as much before it got the games just like most systems.  That's what I'm primarily looking at.

Well, of the ones named Lego City, Need for Speed and Monster Hunter came just out, we don't have yet numbers about the effect they have on sales.

This.