I support piracy, but I also support the developers. The reason I pirate things is because I want to try them first. Money isn't something I have to just throw $60 away here and there on a whim hoping I like a game. The game stores around here don't give you a full refund if you open a game and return it, next day or not. In itself that's fine, for all they know I have a way to replicate authentic disc labels or some other crap. In any case, the game is "used" after the seal is broke, and if I didn't like the game, there is $30+ usually gone just trying a game. Luckily devs have started to catch on to this, and more demos are being pushed out these days so I don't have to pirate as much.
When it comes to backups, I fully support being able to replicate your purchase for future issues, disc or cart. Many people will tell you when you buy a game, you're actually buying a license to use the software. I have a problem with this. If we buy a "license" to use the "software", why do we have to pay to replace the software if damaged? Our license wasn't damaged, that's what the receipt is. Proof of purchase, and the game case and manual are more than enough for any other company you buy a software "license". You just download their software, put in your license/serial, and you're back in your program you bought. Do it for games if it keeps me from having to buy another copy. EA did it with Origin, as my DA: Origins cd key let me add it to my Origin game library. My disc has long been gone, and since they take the CD keys, I get my software back for FREE. I see no reason besides greed that they could not allow something similar.
In either case though, if you do pirate, please continue to support your developers, producers, and manufacturers by buying the games you like at the least. After all, payed devs are happy devs, and happy devs means more or better games. And if not, they should be fired.
Edit: As for the VC, I see no harm in paying a couple dollars for their work on putting them on an emulator on your console. Some games do receive bug fixes and the like, so they do actually update some of the games, possibly costing them development time on other titles, and they should be compensated. I think so anyway. Perhaps not as much as they charge though. VC games shouldn't be over $5, but that's just my opinion. Maybe N should do something like Playstation Plus - Free VC games and stuff for 2.99/mo sub.