PlayStation Phone can play PS1 games.
Well one of the many questions regarding the PlayStation Phone (Otherwise known as the Sony Ericsson Xperia Play or Codenamed Zeus) is that just like the PSP's you can emulate PS1 games to run on it perfectly.
The Video shows Biohazard 2 running via emulation on the unreleased phone. At least the drop out buttons do work with the emulators at a very early stage which is a good sign that we won't have to wait for a proper emulation to kick in for this phone.
The real question I want answered is a price tag for this phone along with release date.