Short answer: No.
Long answer:
No, it's not possible to use a psp (or any WiFi device for that matter) to transmit data as a "radio station". For several reasons. One of which being that WiFi transmits on a 2.4GHz frequency, while radio stations transmit on various frequency bands between like 500KHz and 1MHz (or something like that). And even if the PSP could transmit on the proper frequency, it's far too underpowered to transmit those frequencies of waves farther than a hundred feet or so. And while WiFi, is considered a "radio signal", and simply by standing near a radio station with a PSP would be "sending a radio signal to a radio station," somehow I don't think this is what you had in mind. What is possible, and is in fact a great idea, is using the PSP as a shoutcast server, streaming your media files off the memory stick and over the ol' interweb. Or vice versa (which may in fact be the better choice).
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