[quote name='Warner1281']The PS2 is still selling well (in part due to Sony's PS3 blunders), so there's no need to include it in the PS3. [/QUOTE]Actually, PS2 has gone down quite a bit in sales, but the main reason the PS2 sold has nothing to do with Sony's PS3 blunders (It's the freaking cheap price tag).
The situation is, it might be possible one day, but not likely in the short term. In order for the 40GB PS3 to have PS2 BC, there would have to be a good PS2 emulator not needing the EE AND GS. As of right now, there are some emulators, but very few games even work with it (and many that do have lots and lots of issues). If Sony can create an emulator that can play more than half the PS2 games without requiring a GS/EE, it may happen. If they don't, forget about it. The only method Sony could currently get BC on the 40GB is to emulate every game separately as a driver (like MS does with the 360), and release updates making games work. They considered that method, but with the massive PS2 library, a high percentage of games working wasn't technically possible. Many may want Sony to continuing putting the EE/GS; however, the price on the EE/GS is pretty much at its lowest point, and will continue to make PS3 expensive over time. Outside the external power supply, PS2 enclosure, PS2 DVD laser, etc., it's like your cramming a PS3 and a PS2 all into one console. So basically, continuing to add PS2 components will keep the PS3 at least $50 more expensive (meaning, the PS3 would have difficulty getting below $300, because the Cell/RSX will at least be twice that for a while). It's like if MS had Xbox hardware in the 360, it would continue to be $50-$100 more expensive. Removing the EE helps a little, but not a whole lot (removes $25 at least), but that was the plan all along (EE was only included at launch because it wasn't ready).
Basically, I look at it this way, you can keep a PS2 and get a 40GB PS3. Or you can have it all into one device and pay close to the same. That's mostly how the cost factor works out.
Although in my overall opinion, if you want to play PS2 games, it's best to just play them on a PS2 console AND SDTV. Not because I'm trying to support Sony's idea, but because of my personal experience. Some games the PS2 upscaling improves, while most look no different (just suits them for an HDTV), and some look worse (because they are either too blurry or other issues). Also, only some PS2 accessories will work on a PS3 without issues (getting some dance pads to work may be a pain, and games like GHII and Taiko Drum Master aren't playable on PS3 in anyway). With a PS2, you can automatically play anything and displays how they should. However, you still need memory cards (unlike the PS3 where you create memory cards on the HDD).