The thing is, if the old hardware's in there, why do they need software updates? Unless someone loaded up some bad firmware, the only other thing to update is emulation.
I'd guess it's being blown out of proportion, but with the PS2 I didn't run into a single PS1 game that didn't run perfectly on the PS2. Things that didn't work were generally obscure. Now if FFXII and a Silent Hill game arn't working, that's hardly obscure.