With the recent disappointment in eavpsp for making it too long before we can expect anything in PSGroove on PSP, there seems to be an interesting development. Mathieu Hervais or better know as Mathieulh is a French developer who mastermind and develop the PSGroove project will be working on PSP-PSGroove port. This will be match made in heaven as he know the inner workings of his PSGroove as well as the PS3 console, might be easy to port it to PSP. But, he is not promised anything about this tho. So, we just have to wait and see.
UPDATE: You might be interested with http://dukio.com/gadget/psgroove-psp-pspgroove-proof-concept.html
Stay tuned for more PSGroove port on PSP news!