I only know one guy who had a psp - he traded it in for a DS after spending an afternoon playing with a few of my friends at 4 player mario-kart and metroid (He used my gf's DS).
I prefere the DS - but hey whatever floats your boat.
The DS is the most popular (best selling) computer games device on the market right now. Therefore it will see the most interest from the point of view of game developers/publishers. And it has some class games (not to mention the GBA back catalogue).
I have a DS and Video Ipod for movies/music on the go etc. Its the way to go (ipod rocks!) - but obviously will cost a bit more than psp to get ds+ipod.