I'd say it's much worse. The 60GB cost much more than $599 to build, but Sony sold it at a loss so they wouldn't get ass-raped by trying to sell an $800+ console. Looking at the hardware the execs were presented with, $599 was a good idea (better idea: don't let Kutaragi get carried away again... taken care of). I'm pretty sure the Go costs Sony about the same as the PSP 3000 to build. If Sony sold the Go for a even a slight loss, we're talking about a $149 system at most now. Granted, it'd only be Sony and a couple large retailers selling it, but at least it wouldn't be a complete joke.
If I remember the rumored retailer margins right, selling a Go for a retailer is about equivalent to selling a PSP with at least six games. So the consumer not only gets to pay retailers six games worth of profit up front, but when they buy games from the PSN, it's at retailer-inflated prices. In other words Go owners effectively pay the retailer margin twice for their first six games (to different entities, granted).
$599 for the PS3 was a much better idea IMO.