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PlayStation 3 not 100% backwards compatible?

Sony London has been hard at work on some very hush-hush PlayStation 3 goodness. According to sources close to GamesIndustry.biz, Sony's UK studios are hard at work on both the PlayStation Network (codenamed "PlayStation HUB") and backwards compatibility software for PS2/PSOne emulation.

If the sources are correct, then the PlayStation 3's backwards compatibility is not as certain as it once was. Software emulation is the same trick being used by the Xbox 360 to play original Xbox title, and Microsoft is still trying to get its back catalogue to function properly (as of today, our beloved Psychonauts is still not playable on our shiny 360 consoles). The source claims that "a surprising number of PS2 titles are already working on PS3 prototype hardware." Sony must get the majority of its back catalogue compatible with the new PlayStation or they will lose one of their key speaking points.

Say Sony does manage to get all (or a majority) of its PSOne / PS2 games compatible with the PlayStation 3 -- how much space is that going to take up on the recently-confirmed 60 GB HDD? And what about imported PS2 titles?

[Thanks to everyone who sent this in!]