Without looking it up I think the option to hack PSP games has technically been around longer than the DS. Despite that though PSP hacking is still in its infancy for reasons I am not entirely sure about.
The eboot.pbp file is what holds the binary, though like any binary it can include non instruction related code.
There are various formats commonly seen in PSP isos. Being a bit more powerful than other handhelds there are a few games that use common formats seen on the PC.
Emulator wise there is not a lot, it has got a lot better since various keys were leaked but still not a patch on the likes of the better NES or GBA stuff. This is OK as there are various methods to debug the PSP at runtime.
There are some people doing good work in PSP hacking
http://gbatemp.net/threads/final-fantasy-type-0-romhacking.340183/ and
http://skybladecloud.wordpress.com/ being a jumping off point (
http://skybladecloud.wordpress.com/miscellany-2/tales-of-destiny-2-psp-compression-system/ if you want to get a bit more technical right away).
You might also be able to pull something from
http://akatranslations.wikispaces.com/PSP Translations