The informant tells us Ready at Dawn did, in fact, ship all of its PSP development kits back to Sony last summer, but received new kits in late 2008 after Sony ordered up the sequel. It's possible that, given its current state of development, the game might appear in some form at June's E3 Expo, our source reports. The title seems an unlikely candidate for release this year, but could be timed to coincide with God of War III's launch, which may occur in early 2010.
When contacted for comment, Ready at Dawn president and co-founder, Didier Malenfant, responded: "You know that even if we were [making the game], I couldn't answer your question." We see a "know" in there, but not a "no."