I just bought an R4DS, a system similar to the download for a PSP, only it uses a slot 1 card with a micro SD card for storage.

www.r4ds.com

Games are easily downloaded, and work just like the real thing, but the biggest pull is that it can play media such as films (to a degree), music and view pictures.

Therefore the question:

Piracy or not?

Depends on how the user uses it. I'm guessing that the biggest pull for most people is actually piracy, and not "playing media", since the normal PSP can already do this to an extent.

I'd be amazed if Sony doesn't target them for destruction/lockout.

Piracy to some extent. If it was mainstream and easy to find it would be downright illegal. Most of the people i know with one of these buy all of their games out of devotion to developers.

ironically, the first games I downloaded I have already bought. It's something different to have my DS as an MP3 player, even though it does chew the battery.

As R4DS is intended for the DS, I guess Sony could not care less about it.