Right now, it's really, really hard to recommend the DS over the PSP. The PSP looks amazing, and it makes the DS look like a cereal box toy. The screen and graphics on the PSP are unbelieveable. Some of the better games (Lumines, Wipeout) are very, very good. One of the reasons why I'm not getting a PSP for now is because I can see into the future. (Well, the primary reason why I'm not getting one right now is because it would cost be god damn $400 altogether. I can wait for the improved hardware and battery that will come in the next gen PSPs, and the hardware and software are cheaper. Though, it's a hard wait, having seen 10+ people at the workplace get one first thing.)
But about the future. Let me tell you a little story about my Nintendo DS. Like many DS owners here, when I first got it, I was amazed that a game like Metroid Prime Hunters could run on this little handheld. It took me a while to accept that fact, and then after a few weeks I was over the euphoria of something running graphics as good as the DS does. I've seen much better graphics on the PS2, Xbox and GameCube (Resident Evil 4 basically ruined any good looks the DS games had). The PSP is making the DS look that much "worse," but that is partially because the PSP currently has no equal in the handheld market.
But don't try to kid yourself: The PSP is a PS2. Every single game on the PSP could be done on the PS2 and vice-versa. When the PS3 comes out and your PS2 games start to look a little old, your PSP games will start to look a little old. Even the new PSP games for the time will look like really good PS2 games, and at that time, really good PS2 games will look like N64 games when compared to the games for the PS3 and other next-gen systems. It makes no difference that it's a handheld, because after the general euphoria that the first few months of a new system's release wears off, you're going to be left with a portable PS2, and you've already seen what the PS2 can do.
The PSP probably still has a year before people will really catch wind about what the next gen games will be about, especially the Xbox 360's (since it should already be out by then). By then, the "wow" factor of the PSP's graphics should go away, and then we're back to the debate of which portable gives people the best gameplay experience. Both the DS and PSP have wireless multiplayer and are going to be online, so you can't use that arguement. (Aside: It would be sweet if you could play online games against the PSP and DS at the same time.) Both are probably going to have the same games from the same publishers (see the new games announced in the latest NP if you're unsure about 3rd party support), with the difference that each version would be modified to take advantage of each system's unique properties.
And this is where the DS will have the advantage in the long run.
For many top games, if it comes out for the console, it will come out for the handhelds. The PSP version would be a simple port-down from the PS3 version, minus any features the PS3 version would have due to the console hardware. The DS version would need to be built from scratch (or "ported" from the Revolution version), and might be able to retain many of the features found in the other versions, because the second screen and/or touch screen could be used as a substitute control panel or display. If voice recognition technology starts taking off (the Xbox 2 and Revolution will probably have microphones as some form of input), the DS already has that covered, while the PSP could never do something like that.
Granted, a PSP version will always look better than a DS version, but when it's already been determined that the PSP's graphics will be likely be dated at this time, the one with the better gameplay will ultimately win out. It's been this way ever since handhelds were in existance.
In a year from now, DS developers will understand that rubbing the touch screen in the same boring way doesn't do anything particularly useful. (In fact, it hinders gameplay some because of always needing to have the stylus in your hand.) Hopefully, Nintendo and other developers will get some really awesome games for the DS after the first year. Yoshi and Meteos are great examples of stuff that is impossible to do on a traditional handheld. Reggie himself says that only 30% of the DS's potential has been realized, whereas the PSP's games are really just PS2 games, and those types of games are starting to show their limits in terms of overall variety.
Don't get me wrong, though, there are still plenty of awesome PS2/PSP games coming out. The only problem with that is that they'll probably come out on both the PSP and the PS2, and whether or not they are direct ports of each other, if the same type of game is on both the PSP and the PS2/PS3, you're only going to buy one, and that's going to hurt Sony in the long run. If you really wanted a handheld version of a game you have on the console (and Sony hasn't done anything useful with making PS2/3 games and PSP games share save files), more than likely people will get a DS version if what it offers is different than the likely cookie-cutter ports the PSP will get in the future.
Will there be PSP exclusives? Yes. Will there be DS exclusives (especially from Nintendo)? Yes. That's not the issue. The point I'm trying to make here is that down the road, for the games that are on all the systems, all three consoles and the two (or three, GBA2 pending) handhelds, the PSP version will mirror the console version you probably will already own, and the DS version will offer a different version of the same game. Therefore, if you were going to get a handheld game, people will be more likely to get it on the DS.
I've neglected to mention the fact that the PSP does more than games, as it also does movies, media, music, and all that other stuff. Personally, I think that's awesome. However, if you really wanted to, you could do all that stuff on the DS (and GBA) via the GB Media Player or Play-Yan. Of course, the PSP just blows them both out of the water in terms of quality, but at least DS owners have the option available. The PSP will appeal to more of the disposable income market because of these features, but Nintendo wants to go after everyone else (which is a much larger market last time I checked) with the DS. So in that sense, the two really aren't competing with each other directly.
So for right now, the PSP is in the spotlight. It's going to be that way until the end of the year. To all you DS owners, there's really no point in trying to aruge this, because the hype and style that the PSP has at the moment is just too good. Just remember, next year when the games for the PSP and the DS really start coming, the one with the better gameplay experience should ultimately win out, and that should favor the DS because of its unique features.
But about the future. Let me tell you a little story about my Nintendo DS. Like many DS owners here, when I first got it, I was amazed that a game like Metroid Prime Hunters could run on this little handheld. It took me a while to accept that fact, and then after a few weeks I was over the euphoria of something running graphics as good as the DS does. I've seen much better graphics on the PS2, Xbox and GameCube (Resident Evil 4 basically ruined any good looks the DS games had). The PSP is making the DS look that much "worse," but that is partially because the PSP currently has no equal in the handheld market.
But don't try to kid yourself: The PSP is a PS2. Every single game on the PSP could be done on the PS2 and vice-versa. When the PS3 comes out and your PS2 games start to look a little old, your PSP games will start to look a little old. Even the new PSP games for the time will look like really good PS2 games, and at that time, really good PS2 games will look like N64 games when compared to the games for the PS3 and other next-gen systems. It makes no difference that it's a handheld, because after the general euphoria that the first few months of a new system's release wears off, you're going to be left with a portable PS2, and you've already seen what the PS2 can do.
The PSP probably still has a year before people will really catch wind about what the next gen games will be about, especially the Xbox 360's (since it should already be out by then). By then, the "wow" factor of the PSP's graphics should go away, and then we're back to the debate of which portable gives people the best gameplay experience. Both the DS and PSP have wireless multiplayer and are going to be online, so you can't use that arguement. (Aside: It would be sweet if you could play online games against the PSP and DS at the same time.) Both are probably going to have the same games from the same publishers (see the new games announced in the latest NP if you're unsure about 3rd party support), with the difference that each version would be modified to take advantage of each system's unique properties.
And this is where the DS will have the advantage in the long run.
For many top games, if it comes out for the console, it will come out for the handhelds. The PSP version would be a simple port-down from the PS3 version, minus any features the PS3 version would have due to the console hardware. The DS version would need to be built from scratch (or "ported" from the Revolution version), and might be able to retain many of the features found in the other versions, because the second screen and/or touch screen could be used as a substitute control panel or display. If voice recognition technology starts taking off (the Xbox 2 and Revolution will probably have microphones as some form of input), the DS already has that covered, while the PSP could never do something like that.
Granted, a PSP version will always look better than a DS version, but when it's already been determined that the PSP's graphics will be likely be dated at this time, the one with the better gameplay will ultimately win out. It's been this way ever since handhelds were in existance.
In a year from now, DS developers will understand that rubbing the touch screen in the same boring way doesn't do anything particularly useful. (In fact, it hinders gameplay some because of always needing to have the stylus in your hand.) Hopefully, Nintendo and other developers will get some really awesome games for the DS after the first year. Yoshi and Meteos are great examples of stuff that is impossible to do on a traditional handheld. Reggie himself says that only 30% of the DS's potential has been realized, whereas the PSP's games are really just PS2 games, and those types of games are starting to show their limits in terms of overall variety.
Don't get me wrong, though, there are still plenty of awesome PS2/PSP games coming out. The only problem with that is that they'll probably come out on both the PSP and the PS2, and whether or not they are direct ports of each other, if the same type of game is on both the PSP and the PS2/PS3, you're only going to buy one, and that's going to hurt Sony in the long run. If you really wanted a handheld version of a game you have on the console (and Sony hasn't done anything useful with making PS2/3 games and PSP games share save files), more than likely people will get a DS version if what it offers is different than the likely cookie-cutter ports the PSP will get in the future.
Will there be PSP exclusives? Yes. Will there be DS exclusives (especially from Nintendo)? Yes. That's not the issue. The point I'm trying to make here is that down the road, for the games that are on all the systems, all three consoles and the two (or three, GBA2 pending) handhelds, the PSP version will mirror the console version you probably will already own, and the DS version will offer a different version of the same game. Therefore, if you were going to get a handheld game, people will be more likely to get it on the DS.
I've neglected to mention the fact that the PSP does more than games, as it also does movies, media, music, and all that other stuff. Personally, I think that's awesome. However, if you really wanted to, you could do all that stuff on the DS (and GBA) via the GB Media Player or Play-Yan. Of course, the PSP just blows them both out of the water in terms of quality, but at least DS owners have the option available. The PSP will appeal to more of the disposable income market because of these features, but Nintendo wants to go after everyone else (which is a much larger market last time I checked) with the DS. So in that sense, the two really aren't competing with each other directly.
So for right now, the PSP is in the spotlight. It's going to be that way until the end of the year. To all you DS owners, there's really no point in trying to aruge this, because the hype and style that the PSP has at the moment is just too good. Just remember, next year when the games for the PSP and the DS really start coming, the one with the better gameplay experience should ultimately win out, and that should favor the DS because of its unique features.