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Instructions
Download or purchase a "PSP Video Converter" program. Download one for free from either the "PSP Video 9" or "DVD Video Soft" website. (See Resources)
Install the program to your computer by following the on-screen instruction guide and open the program on your computer desktop. Click the "Browse" button next to the "Input" window, this will open a search window that will allow you to search your hard drive for the flash video file you wish to convert.
Click the "Device" menu located at the bottom left corner of the program and select "PSP" from the menu list. Directly next to that window, you will see another window labeled "Presets." Then click on the pull-down menu and select the quality of video you want the new file. The higher quality videos will have larger file sizes than the lower quality videos. However, if you chose a lower quality option the video can become pixelated when you view it. It is best to chose at least the "Optimal" video quality option. Once those options have been selected click the convert button and wait for your new PSP video to finish processing.
Connect the PSP to your computer via the PSP's USB cable. Under "Settings" on the PSP's desktop, select "USB Connection" and wait for the device to load on your computer. Click the "View All Files and Folders" option from the PSP window that will appear on your computer. From the second window that opens, double-click the "VIDEO" folder. Left click and hold your mouse over the newly converted file and drag the video into this folder; release the mouse to move the file into the folder. Exit out of the open windows and disconnect your PSP from your computer. The video will now be available for playback through the device.