To be able to play games you download you have to downgrade to version 1.5, and then up to a custom firmware.
To downgrade to 1.50 you'll first have to upgrade to version 3.50 and then use this downgrader. You will need the game Lumines in your UMD drive for the downgrader to work.
After you've got to 1.50 then you can upgrade to any custom firmware and play your ISO games from your memory stick.
The custom firmware's i would recommend are 3.40 OE-A or 3.52 M33. There is a new version 3.40* LE but i havn't tried it. You can get the 3.40 OE-A autoinstaller here.
PSP, all the way from 1.00 to 5.50 GEN D2 - DS Lite w/ M3DS Real (M3 Sakura v1.34)
PS3 3.01 - iPod Touch 2G 16GB Jailbroken - Xbox 360 60GB - PC, Q6600, 3GB DDR2, GTX260 (216) 896MB
PSP, all the way from 1.00 to 5.50 GEN D2 - DS Lite w/ M3DS Real (M3 Sakura v1.34)
PS3 3.01 - iPod Touch 2G 16GB Jailbroken - Xbox 360 60GB - PC, Q6600, 3GB DDR2, GTX260 (216) 896MB
This message has been edited since posting. Last time this message was edited on 8. August 2007 @ 08:15
PSP, all the way from 1.00 to 5.50 GEN D2 - DS Lite w/ M3DS Real (M3 Sakura v1.34)
PS3 3.01 - iPod Touch 2G 16GB Jailbroken - Xbox 360 60GB - PC, Q6600, 3GB DDR2, GTX260 (216) 896MB