So ther are probably hundreds of amazing games I haven't played  (games from the 1st gen to the 6th) that I need to experience and I've forgotten about my PSP that I left at my parents place years ago (I do believe it's the 3000 version). So I've been thinking about bringing out that old beast and hack the system so that it can play basically any game from the 1st to 6th gen, so all NES, SNES, GC, N64, PS1, (maybe Xbox? and I assume it can't play PS2) games that I missed out on. 

So I've never hacked a system or put homebrew on it before so I'm looking for the safest and easiest way of doing this. I'm worried I might ruined the system. 

What programs should I do?

What's the step by step process?

What programs should I put on it to play games?

http://wololo.net/cfw4dummies/

Buy a vita.

Is there good hacks on it now?

What can you do with it?

I knew this was going to mention emulators and hacking. I don't think PSP can emulate the GC and Xbox though, since they're more powerful.

I don't know how to do any of this stuff though.

Yes there are hacks for the Vita, but we're not at PSP level hacking yet - not by a long shot. wololo.net for more info.

Stick with the PSP. It's a powerful system and an excellent emulator.

Yea, you defiantly should! I hacked my dsi, psp, wii and my ps3... best shit ever!!! I would hack my 3ds if my firmware wasn't more than 4.5 T_T

Here is another site to help you hack it

http://www.dashhacks.com/psp/custom-firmwares/dashfaqs-how-do-i-hack-my-psp.html

it can't emulate GC/Xbox/PS2 since those are more powerful than it.

Hah, Xbox. It can't even do N64 decently, sadly.

Start off with kupomogli's link - for programs (emulators, really) go here:
http://wiki.gbatemp.net/wiki/Emulation_on_PSP

Personally, I can recommend picodrive (Genesis/Sega CD) Masterboy (Gameboy/color, master system) NesterJ 1.12 AoEX r3 (NES) (other one also works well) and Snes9xTYLmecm 11-27-09 MOD r23 (SNES). Once you have CFW, use USB connection to transfer all the emu files to PSP/GAME. Make a separate folder for each emu, once transferred and CFW is active, you're gonna see them in the game section of the XMB.

Too lazy to speak of more things now.

Ok here is my strategy:

Step 1: unscrew PSP, take the mainboard out.

Step 2: Build the ultimate gaming machine

DONE!!