Wow. Those screens, if it's indicative of the final product, is good news for gamers. Though I guess it depends how they roll it out. Emulation can go one of two ways. It can be like the emulation on the PS3 where PS2 and PSX classics had to be purchased and downloaded. The other way would be through software and the original discs. I'm hoping it's the latter since I have all my PSX and PS2 discs still displayed proudly on my shelf. Unfortunately, Sony has released next to nothing so we won't know until it's rolled out or until they release some more info.
I still have my PS2 hooked up to my HDTV so when I feel the need to play a classic, I can just turn my TV to component, drop in the disc and a memory card and go to town. However, my gripe is that on modern digital TVs, the games look like shit (like the bottom picture Paul posted). They weren't developed for a digital TV, but for analog. They were also generally made slightly below SD resolution. When they are stretched out on a 1920x1080 TV, it's just not that good. Eventually, I would like to make a truly gaming entertainment center but I'm at least a couple years out from having the space to build it (in which I would buy a good SD TV to hook up my PS2, Genesis and NES for classic gaming). So in the mean time, if they do emulation through the discs, that would just be simply amazing.