Saw this on the best buy website. I did not think that the new 40GB had Backward compatability ?? They may have just copy and pasted from previous product specs.
http://www.bestbuy.com/site/olspage.jsp?skuId=8588584&type=product&id=1190677842792&AID=10474050&PID=249294&URL=http%3A%2F%2Fwww.bestbuy.com%2Fsite%2Folspage.jsp%3FskuId%3D8588584%26type%3Dproduct%26id%3D1190677842792
"Plays your old PlayStation 2 and PlayStation games, DVDs and CDs, so you can merge all of your entertainment into one machine "
http://www.bestbuy.com/site/olspage.jsp?skuId=8588584&type=product&id=1190677842792&AID=10474050&PID=249294&URL=http%3A%2F%2Fwww.bestbuy.com%2Fsite%2Folspage.jsp%3FskuId%3D8588584%26type%3Dproduct%26id%3D1190677842792
"Plays your old PlayStation 2 and PlayStation games, DVDs and CDs, so you can merge all of your entertainment into one machine "