Nobody can touch the Gameboy. Just like no one can catch the PS2. But, I don't hold out much for the Nintendo DS future. Nintendo said from the start that it wasn't a replacement for the Gameboy line. I do think the PSP sales are impressive given the cost of the system. (I'm even more shocked at the amount of UMD movies that have been sold!)
Regarding the pixels, people with dead/stuck pixels should have their PSP replaced. Sony has already said they would warranty them if needed.