PSP Go also failed on my account because cables (I had two PSPs) were different and the controls were too cramped for my tastes. You also couldn't upgrade internal memory, but that wasn't a disaster. I did actually buy most games digitally in the last few years for PSP as I had two, and that is something that I now benefit from on Vita.
Vita is just about perfect for me though. I love that thing, what a brilliant device. Now where's the Netflix App?
It's been 2 years mostly now that the system launched, since launch 28nm has become widely available, Sony just unveiled the first redesign and it seems that the price of the system may not go down, at least significantly, bad news no new silicon.
It is a big issue as it is clear that the price is way too high. They have a issue here. My belief is that the issue here is the way the system has been designed, slightly custom CPU, slightly custom GPU, 2 memory pools (all iirc), etc. which in the gran scheme of thing doesn't do that much for the system aka the competition is way underpowered (I speak of the 3DS).
Now to have new silicon, they can't use either off the shelves IP implementation on 28nm process be it ARM Cortex A9 or PowerVR SGX 543mp4.
Went it is all said and done, at launch lots of phones were way ahead of the 3DS capabilities, Sony wanted to be really high end (above Apple phones which invested lots of silicon on GPU performances but asked 500$ and more...), in the end 2 years later and mostly just ahead of 20nm launch, lots of phones have catched up with the PSV, I would think that lots passed it.
On the technical side the PSV is no longer something special, 2 years have passed.
Shortly put the PSV was overdesigned, it doesn't need all that "custom jazz" to significantly outdo its competition which is the 3DS not high end phones, that exist on a separated plane, wit extremely aggressive competition, huge R&D budget, huge volume, etc. and with hardware that is refreshed more often than not.