1- linux shouldnt hurt you except in area's like using the gui's for converting ps1 games for use on 3.03 oe
2- to upgrade to 3.03 oe you need to first be on 1.50. to be on 1.50 you may need to downgrade which is only possible from 2.80 and down a believe. may be wrong.
3- a bigger memory stick.
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