According to the findings of Beyond3D , Sony's PSP now comes with a interesting choice, either you have a CPU clocked at 333MHz and your Wi-Fi disabled, or you want your Wi-Fi to work and then be limited to 222MHz CPU clock.

As you may all know, PSP was limited to 222MHz CPU clock and 111MHz bus clock. With the 3.5 Firmware update CPU clock got boosted at full 333MHz, while bus speed ended at 166MHz. Apparently you only get full 333MHz when your Wi-Fi is disabled. That means, if you do network play CPU clock goes back down to 222MHz.

This limits the game development, as the games with network play are limited to 222MHz. I doubt that any developer will bother to make one engine for single player and then downgrade it for the network play and 222MHz. Anyhow, single player games can still benefit from the 333MHz CPU clock.

The main conclusion of the entire web is that this was done to preserve battery life, 333MHz and Wi-Fi is just bad for PSP's "little" battery.