You need a PS3 to download PSP & PS1 games on the Vita? So the millions of people who don't have PS3's are left out?
Yep, though apparently PS1 games aren't transferable at all at the moment. Many PSP games require a PS3 to install on a Vita (such as Valkyria Chronicles 2 and its DLC, which I just transferred over but aren't in the store or downloadable on Vita), though looking at the grand unofficial list fewer than I thought. When you go to your download list, these games show up as "Can't be downloaded to a Vita" where the "download" button is usually located when viewed on a Vita. And they don't appear in the Vita version of the PS Store at all as games that can be purchased. To play these games, you HAVE to download them first to your PS3, leave them on the XMB in "bubble" form, hook your Vita up to your PS3 through its USB power cable, and then use the Vita to transfer the files through its content management program.
Oh yeah, and while you're transferring these files, the Vita is not drawing power from the PS3 so you could conceivably run out of battery power doing this. I've only transferred a few files at a time and I keep my Vita hooked up to its charger at nearly all times so I haven't run into that problem yet, but it's truly a brilliant situation Sony's created here.
EDIT: OK, it seems I need to make a major correction here, and it actually makes the situation worse. Starting tomorrow, I'm going on vacation with my family for a week, so I thought while I was still up and not doing much that I would transfer my Resistance Retribution PSP game over to my Vita instead of Dissidia 012. After all, I'd already transferred my original save for the game over yesterday. I thought Dissidia was one of the locked games as well, but apparently you can download that from the store. Apparently, that's not going to happen, because Resistance (one of the games you can't download to the Vita) also can't be transferred through the content manager at the moment. I don't know if the PS1 games can, as I don't have any in "bubble" form at the moment. So apparently, if you can't download them to your Vita natively, it doesn't look like you can transfer them either.
Reading up on the issue, it does look like there are games that you can only transfer to your Vita through a PS3, but my "locked" games do not seem to be on the extended list as compatible games. If Sony has any sense, they're making those remaining "locked" games work on Vita, especially the 1st party stuff like Resistance.
So despite Sony's assurances that "all your old PSP digital software will be playable from Day 1 on Vita", that is not the case at all. You can't even work around the Vita's stubborn download refusals. Oh joy. Damn, I really wanted to play Resistance Retribution on vacation now that I can play it with the right analog stick as the camera... 
Good God, it's like Sony hasn't learned anything from their past mistakes. Wow. So, hypothetically speaking, if I have PS1 games installed on my PS3, I can't transfer them to the Vita unless they're in "bubble" form (meaning I'd have to redownload them again)?
Uncharted is about the only exclusive game that's making me keep my PS3. If Uncharted was a multiplatform game (the IP not owned by Sony), I'd sell my PS3 immediately and buy an Xbox 360 instead.
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