I own 7 games on UMD, I also have over 100 games in ISO format like many people here. My 2 reasons for using these ISO's without moral issues are as follows:
Firstly, when running off a 2gb stick (rather than the 4gb drive which I've just sold) they run incredibly faster than their UMD counterparts. Not just slightly faster, a whole lot faster.
Secondly - IMHO the majority of games for the PSP are pretty weak. I will try a game first, then go out and buy it. In case you were wondering, yes I only feel the need to own 7 out of the many I have tried, one of which is GTA.
I applaud MPH's work - the idea of restricting it to being solely a UMD loader is lunacy.