Yeah, you're completely right, there aren't any good games on the PSP. There isn't Monster Hunter Freedom, Lumines, The Godfather, LocoRoco, Metal Gear Solid: Portable Ops, GTA Liberty City Stories, GTA Vice City Stories, Tekken: Resurrection, or Maverick Hunter X.
And there isn't anything good coming out for the PSP either. It's not like there's a Final Fantasy Tactics remake on the way, nor a Final Fantasy 7 prequel. A remake of a rare CastleVania game won't be released for it either. R-Type Tactics is obviously going to be a no-name flop.
It obviously does not have online play, and the price cut certainly did not help boost sales numbers. It isn't currently the best selling platform under Nintendo at the current time, and the PSP definitely hasn't sold as well as the Gamecube did last generation in much less time. The firmware certainly can not be the most flexible firmware ever to widely be accepted in platforms, and it doesn't matter anyways, because the PSP obviously has sold less units than the Dreamcast did.
Of course, this is just me thinking off the top of my head about all the things the PSP should have that would make it a valid contender to the DS. If it actually had these things only half-way through a platform-war, you never know, it could stand a chance to become the heavier platform, but probably only with a nice, fancy looking redesign to strengthen it's public appearance, like what was part of why the DS has been successful. Aren't we all glad the PSP doesn't have these things so we're 100% sure Nintendo will stay far on top?