Is that using two threads (one for the rendering, and a second thread for the emulator, or even splitting the emulator into more than one thread)? In my initial testing with the SDK I can modify an image the size of the screen repeatedly and paint it at about 60fps... The Vita is quad core, so I don't see why emulation couldn't work, it would just take a good amount of work I imagine optimizing the code. Is this demo that you linked to have code published anywhere that I can download and play with? If you open source the code then you don't need to publish to the PS Store, people can just pay for the dev kit and compile it themselves. I'd be happy doing that to get my emulators working consistently.
The code is not downloadable. This is just a test from a developper. Also, sony will NEVER agree about buying the SDK license just to build Open Source project (especially emulators). In this video, there is just a bit of Genesis hardware emulated, so even 1 core is sufficient. Multi-threading system is cool to speed up some application, but that can't be used everywhere / in all cases.
In my initial testing with the SDK I can modify an image the size of the screen repeatedly and paint it at about 60fps... <-- That mean nothing.