[quote name='whatsinaname']It might not be worse from a price perspective but it is atrocious that games/in-built apps would not even start till my memory card got to me. This is even worse considering that the game carts are actually re-writable media and not UMDs.[/QUOTE]I remember a gaming podcast (the Giant Bomb one IIRC) recently touched on this exact subject. Their theory was that while the carts can be written to, including that storage on the game itself would mean an increase in production costs for the publisher. A lesser factor is that it would also mean they would have to managed a separate, albeit extremely similar, codebase: one for the cart which is designed to take advantage of the memory on the card, and a digital version that knows not to try to write to a physical cart that isn't there.
Although Sony designed the system to offer the choice between on-cart and memory-card storage, basically it's easier for the publishers to just depend on the consumer to float the cost for the storage.
[quote name='6er']Nintendo doesn't screw people like that on the 3ds, you can save to.the cart[/QUOTE]Nintendo also allowed publishers to make save files on the 3DS that couldn't be erased. Even some of their own games, such as Pokemon, have save files that are big enough where a game can only store a single save. A second person can't start up their own game on the cart, they'll have to go buy another copy of a $30-$40 game. Their solution isn't perfect, either.
Nintendo was also offering a far less powerful piece of hardware for the same initial price that the Vita is currently at. Sony is simply trying to recoup development costs in bits and pieces through an expensive storage media. They know selling a portable system at $250 is already a tough enough sale as is. Nintendo's modest system specs aided in the quick abandonment of that price point.