Oh there was one other possible reason for this happening, someone mentioned that it happened when they were using a psp mini as a base game rather than a full title, said they changed over to using a different psp game and it worked perfectly, could maybe give that a try? you'll have to go in and get another titleID from another legit psp game on your system and change that config file again, then reboot the system, head back to beta.henkaku and then try launching that other game and checking if you still see corrupted homebrew icons, if they worked on the 1000 model psp they should work perfectly on this.
Good luck mate.