Not long after the toc2rta exploit made it possible to run some code on a PSP with v2.00 firmware, a downgrader has surfaced. All respect and appreciation should go to MPH for doing what many tried and failed to do. I have tested this method and just spent the last few hours preparing and putting a guide on the site for it. Check this out...
I successfully downgraded my PSP from 2.00 to 1.50. The guide I have written has some screenshots and some pictures I took of my PSP (quality kind of sucks, but I'll see maybe tomorrow if I can get something better online.) There is a lot of text at the start of the guide (including one warning EVERYONE must read) because I give a brief overview of the process before illustrating it properly.
This guide was written with intent of making it a little easier for new PSP users to downgrade to 1.50 to run legal homebrew apps. This is not a guide to PSP piracy. I believe that since you bought the console (and let's face it, they are not cheap) you should be allowed to run your own homebrew and not just "authorized software".
Check out the guide at: http://www.afterdawn.com/guides/archive/downgrade_psp_2.cfm
Feedback (spelling mistake notification etc.. ;-) ) is welcome, just send me a PM.
Again, all respect to MPH for the excellent downgrader.