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The latest version of DevHook supports PSP Firmware 3.01 emulation. This means that if you one of the lucky few to own a PS3, you can now stream Playstation games to your PSP while still retaining the ability to run your homebrew applications! This is amazing progress made by a lot of different developers of the PSP Homebrew Community. Kudos to Bolster for releasing this so quickly!
You can find out more information about PSP 3.01 Firmware Emulation from: PSP Updates
Someone also created a video tutorial on how to install the needed pieces to get this to work.