It might just be me, but I think thats more than one question. All of the questions you have asked are already answered in various threads, but I couldn't hurt to have them all in one place for all those lazy people out there. (You know who you are! ^_^)
OK, here goes.
1. You cannot "compress" an ISO to be used in a PSP; you can however RIP an ISO. To RIP is to remove or replace "unnecessary" files from an ISO lowering its size.
2. True, UMD's can hold 900MB per layer, to a maximum of two layers. However no game as of yet has reached close to that, the largest being about 1.2GB, I think.
3. There is no way to get access to the outside from the PSP as of yet ( ^_^; ) UMD's can only be dumped to the MS. There is a program that allows you to dump single files onto the MS UMD RIP UTIL
. You could dump a 1.8GB UMD using this program, bit by bit, then reconstruct the ISO on your computer.
4. As I stated before there is no way to "compress" an ISO but you can RIP it using a RIP Kit or the generic ripping tool UMD ISO SHRINKER
, but how much the size will be reduced is unique to the ISO.
5. Once all this is done you should hopefully be able to put your large ISO on your PSP, but then again maybe not.
Always glad to help.