Neuros launched a new version of its digital mp4 video recorder. The Neuros MPEG4 Recorder 2 supports direct encoding for the Sony PSP.

The Recorder 2 records video content from any video source directly onto memory sticks that are playable on the Sony PSP, as well as other portable video players.
The Neuros Recorder 2 works like a VCR and also supports timer controlled recording.
The WQVGA (368 x 208 pixel) resolution is the one optimized for playback on Sony PSP consoles.
Note, that the Neuros Recorder and the Neuros Recorder 2 look similar. Only visual difference is the Memory stick slot, which the original Recorder does not have.
I only saw the Recorder 2 available for order on Neuros site. It sells for $149.99. Other retailers still only list the original Neuros Recorder.
See also this review of the original Neuros Recorder.