OK, here is the update changelog for the US version (from http://www.us.playstation.com/ps3/network/updates
The PLAYSTATION®3 system software version 1.31 update includes the following: Settings
You can now register the BD remote control in [Register Bluetooth® Device] under [Accessory Settings].
[BD/DVD Video Output Format (HDMI)] has been added as an option under [BD/DVD Settings].
[Backup Utility] has been added as a feature under [System Settings].
You can now select the hard disk format method in [Format Utility] and [Restore PS3™ System] under [System Settings].
The method of selecting output resolution has been changed in [Video Output Settings] under [Display Settings]. Game
New for 1.31: You can now play PlayStation®2 format software titles that must be installed on the hard disk. Other
The compatibility of USB devices with PlayStation®2 format software titles has changed. For details on USB devices that can be used with system software version 1.30, select here.
New for 1.31: Playability status with the PS3™ system has changed for some PlayStation® and PlayStation®2 format titles. To check on the latest status, visit the search site for compatible titles.