And you'll probably find that if such people contact Sony personally, they'd probably still have something sorted out. After all, they certainly have no use for PSN (at least in the case of people in academia who are not just your average scruffy undergraduate student).

They didnt work something out with the Department of Defense....... ;( The AirForce had hundreds of PS3s for those kinds of reasons,

Neither do I. That's why I basically don't give a damn. And why I didn't think about other non-pirate and non-gaming related uses for the PS3. My bad, @PoSSeSSeDCoW. That definitely sucks.

No problem. I was more harsh in my reply than I needed to be. I know some people who were screwed by it, and Sony hasn't done anything to help. It's annoying.

This. Verbatim.
I am firmly in the camp that thinks if you buy a piece of hardware you can do whatever the hell you want with it. If you choose to use it for copyright infringement then hey, you suck and I hope you get caught, but that has little to do with the belief that a piece of hardware I bought is mine to do with as I please.
Of course, I don't have a PS3 or iPhone because I dislike closed systems in the first place, and why people who want open systems support those companies is beyond me.

Regarding Steam: no, I don't. Sorry. But they do have a deviantart account under the same name. I don't know if that has any contact details or not.

No worries, I had an incoming call I had to take on Skype, so I had to get off Steam... im sure ill track him down sooner or later,

While I think Sony should continue to be raked over the coals for their removal of Other OS from the PS3, this particular jailbreak was used pretty much exclusively for playing pirated... sorry, "backup" copies of games, so I can't fault Sony too much for blocking this particular exploit.
What I find rather amusing, though, is that the PS3 seems to be targeted for jailbreaking far, far more since the removal of Other OS. My own opinion is that the real tinkerers were pretty content as long as they had Other OS and could do whatever they wanted with it, while the pirates generally didn't have the skills needed to break the console's security (on most other consoles the pirates have just piggybacked on exploits developed by the homebrew crowd). In removing Other OS in response to a perceived security threat Sony just seems to have painted a massive target on the PS3 for folks who are capable of breaking its security but were previously content not to. The irony is delicious.

I can totally understand taking measures to prevent piracy, and I'm behind it 110%, but I'm not so enthusiastic about preventing users from installing "unlicensed" content that hasn't been approved (read: the Seal of Approval hasn't been paid for) by the manufacturer of the hardware. I mean, what if companies did this stuff with VCRs and DVD players and the like? "Oop, sorry, it's not a Sony movie, so you can't watch it on this Sony VCR".
I can understand the licensing process for the purposes of weeding out less than quality games and apps, but shouldn't that decision be left to the end-user and not the manufacturer of the hardware? I mean, if the users decide the software is bad, then the companies that make the software probably won't last long enough to make more bad software anyway, or conversely, they will learn from their commercial mistakes and start making GOOD games.