actually, thin crust, this only happened like two weeks ago. and i posted it the day it came out. so it's not really old news.
sony seized all of PSJailbreak's assets, but there's so many open source version floating around (for the blackberry, TI84 calculator, USB dev boards, and android, and supposedly a PSP kit is in the works) that it doesn't matter.
also, it doesn't matter if it doesn't work anymore in 3.42. as the psp has shown, there's a ton of custom firmware options that will be come available pretty quickly. there are a lot of people - myself included - that never updated past 3.2x, because they wanted to keep the Other OS option available. the PSJ hack allows me to get back online through that OS without being forced to update to use my console.
i think you're missing the point, though. yeah, this enables piracy, and that's not necessarily good. but what IS good is that now you'll be able to use the ps3 for tons of cool stuff that, since the removal of the Other OS option, you haven't been able to touch.