to play newer games you just need to decrypt the EBOOT.BIN inside the ISO image. If you have space on your MS (which I presume you don't have that much space seeing that you only have a 2GB stick) you can use ISO tool by Takka (this method is explained in the tutorial that quikrazor87 posted a link to), but I usually use this method:
Stuff you need:
UMDGen to extract the Eboot.bin file and to reconstruct the image.
Edecrypt to decrypt the file.
Steps:
- Spoiler
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Install Edecrypt onto your PSP
Start UMDGen and open the iso that you want to patch.
navigate to PSP_GAME/SYSDIR , where you will find a file called Eboot.bin. Right click and extract the file, then place it in your MS at ms0/enc (create the folder) Keep this window open.
Start Edecrypt, the press X or [ ], then when it is done, you will have the decrypted eboot.bin in the /enc folder (or somewhere else, can't remember

)
Go back to UMDGen, and delete the original Eboot.bin and replace it with the new decrypted one. Then, click on the "save" icon and reconstruct it as an iso or a cso.
this method is good because you don't need that much space on your memorystick. (I have tested this on God Eater Burst and Tactics Ogre)
Hope this helps

My PSPs:
- Spoiler
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PSP 3002 (03g) 6.60 PRO-C (thanks Coldbird & Virtuous flame!)
PSP 2002 (02g) 6.60 ME-1.8 (thanks Neur0n!)
If you want anything translated to/from japanese (to/from english) for your
Homebrew, send me a PM and I'll see if I can help
