If that's the case, why did people setting their PS3's to the correct (OS) time not let them play their games - including disc-based games?
I think this issue is being glossed over. I know all DRM requires a timestamp - my concern is that Sony's DRM seems to require the CMOS timestamp, which implies when the battery dies altogether none of your DLC or PSN content will work, and none of your trophy-based games on disc will work. I'm not comfortable with that, and I hope they fix their system to make it work, because it's a shoddy thing to do and it's easily avoidable.
I think it is more likely that the PS3 OS is hitting a error with an "unrecognized time", which was the main problem.
This is pure speculation, but works logically for me.
It's not that the CMOS time stamp is required or something, it just needs to have a "recognizable" CMOS time stamp for the PS3 OS DRM to work properly.
If this wasn't the case, the removal of the CMOS battery would wreak havoc on the DRM of the PS3s that did have their batteries removed and this apparently did not happen.
This would make sense since an unrecognized time is not within the system's design so the developers didn't anticipate a workaround for the DRMs to just look at the system time, it simply wasn't thought about.
Taking out the battery will reset the CMOS time to some pre-determined date, and then the OS will recognize that pre-determined date again, and therefore DRM will work as usual again as resetting the CMOS time moves the CMOS time away from the unrecognizable 2010/02/29.
The battery being dead would probably not be a problem. In the case of the battery being dead, every time you turn on your PS3 would probably require you to enter that day's date and time to calibrate the OS date as the PS3 has no means to keep time while it is turned off. But while the PS3 is on, the CMOS time stamp should be available.
Furthermore, since the CMOS time would be that recognizable pre-determined date, DRM should be able to work properly.
For a test, someone could remove the CMOS battery and try to log on. If I'm right, then the battery being dead or not should not affect DRM.