@mike_intellivision
What are you smoking? The PSone and PS2 were billed as multifunctional CD and DVD players respectively. They were huge selling points early in their lives, particularly for the PS2. It was one of the big things that killed the Dreamcast actually: the PS2's DVD player was the reason a lot of people waited for it.
The reason this didn't work for the PSP was that it wasn't a particularly good multifuctional device. UMD was a terrible idea from the beginning. Being able to play digital media was aslo bsically useles without either an online store or any built in storage (particularly that last bit). On launch, 2gb memory sticks cost upward of $50; another proprietary format that bit Sony in the ass.
The point is that it is rediculously stupid to say that being multi-functional is somehow a handicap. As long as all those functions work well and work well together, it is a huge boon. Many times they can actually be synergetic, as in the case of Monster Rancher, or the location-based functionality of many iphone games, or simply the abilty to play your own music on the same device when the soundtrack sucks. What killed the PSP was poor execution of its non-gaming functionality (especially UMD), as well as rampant piracy.