Well, I have both. And I can clearly state that my DS gets much less attention than my PSP. In fact, I am trying to sell it for a PS3 right now. My homebrew PSP keeps me entertained for hours. The decision is yours.
I agree with you about the psp, mine keeps me entertained when I use it. This guy should keep his ds then buy a psp when he saves money because I wouldn't sell either of them.
I've owned both.. I'd say my DS got more play time because I had a flash card and more people that I knew had one. If not for those 2 reasons, the PSP would have gotten more play time from me personally.
I'd say to keep your DS, just in case you want a DSi or something like that. Find most the DS games you don't play, and sell them, and if you have enough money to buy the PSP and keep your DS, go for the deal. That's the only thing you can do with common sense, if you don't play your DS anymore and you get tired of looking at it sitting there, sell it. Either that, or pick it up and start gaming! :]
Anyway, yeah, I would DEFINITELY trade my DS in for a PSP. Sure, there aren't as many games available, but it's the only system where you're able to download free retail games. And that has given me enough to keep me hooked on my PSP.