That's not very indicative of PSP selling "badly". It's a matter od DS selling really f**king well, and PSP selling "less well". They're both doing very well, only DS is just selling like hotcakes.
I find it hard to believe that the PSP is selling well, only for the fact that Sony estimates negative growth for the PSP in 2007 (3rd year on the market) and has been doing so for awhile.
That fact alone is not enough to convince me the PSP is selling badly either especially when using comparsion to the DSL, when the price difference is so large.
Sony's lack of aggression on price dropping of the PSP has to reflect on sales. But it makes me believe that Sony sees the PSP as more than just a competitor to the DSL. I think in Sony's eye the PSP also competes in the MP3/portable video player world and that demand will eventually will grow for a product such as the psp in $299 range.