apparently the 40gb ps3's will play ps1 games NOT ps2 however the 60gb(?) or the top model ps3 WILL play the ps2 games information that i was told by a friend so that could be the problem
the 60Gb was discontinued a long time ago due "not enough demand" for it, thats when they introduced the 40Gb version. Although just before xmas remaining stock was sold on.
there is speculation of a 80Gb version coming out but nothing has been said about it from sony, although if you want more memory you can upgrade it yourself. The 80 GB model was released in South Korea and its identical to the 60 GB model released in the europe except for the difference in hard drive size