StrmnNrmn has updated his fantastic Nintendo 64 Emulator for the PSP, heres what he posted:
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I was going to wait until tomorrow, but I thought I'd release this now and have a bit of a lie in tomorrow morning
[!] Disable PSP FPU exceptions, enabling many more roms to run.
[!] Fixed ambient lighting bug.
[!] Fixed scissoring.
[~] Only create temp rom file if compressed (not swapped).
[~] Fixed decaling offset.
[~] Lots of combiner additions/fixes.
It's quite a short list, but hopefully people will find some significant improvements in compatibility. I haven't looked at improving performance yet - that's probably the next area I'll focus on.