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Remember the post on how to download PSP ISOs? If you have forgotten, here it is:
http://pspslim200.blogspot.com/2008/07/where-to-find-psp-games-isoscsos.html

Now, the problem is that some ISOs can be really big in size and may not be able to fit into your memory sticks. The solution? Buy a bigger one xD...no just joking.

With UMDGen tool, you can convert your ISOs into CSO with presses of buttons. =)
Here's what UMDGen looks like(download provided at bottom of post):











Ok, now to convert your ISO.
First, open your ISO with UMDGen, to do it, simply drag and drop your ISO into the UMDGen window.

Next, click File>Save As>Compressed (*.cso)Select where to save your CSO file and wait for it to complete compressing.

You are done! Congratulations, you now have a CSO copy of your ISO!

Download UMDGen :