No way it hits FFVII levels. MGS has never been that huge. Plus, RPGs just play better on the PSP than action/adventure games.
I totally agree about the PS1 classics being better on the PSP. First off, the low res PS1 games (originally 320x240) just look fantastic on that little screen. Second off, you're getting to play something of the highest console quality on the go. It's a fantastic combo.
Right now I'm totally sucked into Suikoden...II. I know, I'm a "pirate" considering the game isn't on the PSN, but what am I supposed to do to play this classic? I did buy Suikoden I just to let Konami know I want to see a re-release of this classic.
My Top 5:
Shadow of the Colossus, Metal Gear Solid 3, Shenmue, Skies of Arcadia, Chrono Trigger
My 2 nex-gen systems: PS3
and Wii 

Prediction Aug '08: We see the PSP2 released fall '09. Graphically, it's basically the same as the current system. UMD drive ditched and replaced by 4-8gb on board flash memory. Other upgrades: 2nd analog nub, touchscreen, blutooth, motion sensor. Design: Flip-style or slider. Size: Think Iphone. Cost: $199. Will be profitable on day 1.