Don't see why FPS would work so bad on PSP. Buttons (X, circle, triangle, square) control movement (straffing) while the nub controls aiming. L and R buttons fire primary and secondary, d pad controls jump (up) duck (down) and weapon change (right/left). Not really that complex, though it is slightly limited.
Now if its a statement against the quality of the nub as an analog device for fine precision, ok, we got a real discussion on our hands, but then I guess you'd just have to resort to aim assistance.