I knew about the 460 MB thing because of working with mass storage devices in the past. Stoarge dvice companies tend to rate things with two misleading factors:
1.) They often use 1000 bytes as a MB instead of the 1024 used by computer operating systems. Ofcourse this only leads to a 2.5% overhead.
2.) They report unformatted space. When the OS formats any piece of media it has to create a table so that it knows where to store and retrieve information. The actual overhead percentage shrinks as the size goes up but the difference becomes so apparent as you go up in size that it has only recently become a public issue.
For instance, a reported 256 MS Duo actually only holds around 220 (for a little under 15% overhead); whereas, a 512 MS Duo actually only holds around 460 (for a little over 10% overhead). On a 1 GB stick it becomes even more apparent because once again a gig in common terms is 1024 MB where to the manufacturer it is 1000 MB so the overhead percentage shoots up again. So I would expect to get between 930 - 940 MB on a 1 GB stick (although I haven't seen technical numbers on it).
Hopefully manufacturers will soon realize that consumers aren't IT workers and they should standardize their terms so people don't feel misled.
Oh, and thanks for the info on the movie thing. I have an eight hour flight down to BVI coming up this summer so that's the only time I can forsee needing/wanting to watch a full movie on my PSP.
-DD
[EDIT]
Just found a place that confirmed 1GB Sticks actually have 940MB worth of room.
[/EDIT]