Contrary to a “PSP shell” which runs on top of the XMB, Project4 installs and operates directly from flash memory — replacing the XMB entirely.

Unlike open beta 1 & 2, this installation differs… Please see the always important README.TXT before continuing.

What’s new since Open Beta 2?

Added a boot sound with option to turn on/off.
Added an optional filebrowser background, perfect for people who find their normal background doesn’t go well in the filebrowser or gets in the way.
Added a clock with configurable options
Changed the code to load the EBOOT menu when entering a folder with an EBOOT.PBP inside, only applies if using the “Request” option.
Allowed the icons to be varying sizes, giving the ability to customize the menu even more than before. Icon sizes are determined during bootup, so no editing in the config required.
Moved the selected icon to the centre, instead of the first.
When playing music, album art can be showed as long as Folder.jpg is present in the directory.
Added M3U playlist support, which works in all directories above or below unlike previous versions.
Added the “Low Key Music Player” which is like a very basic version of LightMP3 installed in the flash, when booting up the PSP if you press the left shoulder button it is loaded, and plays music in the file ms0:/PSP/MUSIC/LKMP.m3u. The clock speed is drastically reduced, making this a good option for those who use their PSPs as their main mp3 player.
Added some notes saying how to save, and how to temp save the config.
Changed the about screen to make it appear neater, and compacted the lists.
Centralized the menus (mount, request, extended) which looks neater, also changed the colour scheme for them.
Updated the default config written to comply with the updated code.
Added a [#] to each of the options that do not yet work, these are mounting of flash3, XMB loading, and resetting the PSP.
Added a device mounter that can mount: Flash0:/ (read mode only), Flash1:/, Flash2:/, Disc0:/ (untested but should work), Host0:/ (assuming RemoteJoy or other plugins are loaded
A couple bug fixes…

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Source