Vektar won't be the only shooter for the GP2X. I am the lead programmer for Stargazer (Project Luminence) for the '2x. It's a vertical-scrolling shooter in the traditional Danmaku style with some interesting twists I think you will enjoy. It is a fast-paced, intense and over-the-top game.
It is designed to take full advantage of the processing, graphical and audio capabilities of the GP2X, heavily optimized for the ARM architecture with high-end visuals that still borrow from the style of the 32/16-bit era and Cave-ish arcade stylings.
There will be multiple levels, many playable characters with their own unique attack, defense and special attack styles, a full CD-quality soundtrack, and there will be PC, PPC Macintosh, and Dreamcast ports. Very likely an XBox port as well, PS2 is being considered.
Engine development is coming along very fast; speed tests indicate an average framerate of 115 FPS (capped to 90 FPS for the GP2X LCD hardware's native redraw rate) with audio playing, and 140 FPS without. This is at the GP2X's default CPU speed of 200 MHz. The engine is not optimized yet; it will only get faster.
Expect a fully playable demo later on this year-- probably around September-- and preview media and more information much sooner than that! I will make announcements here and on the most populated GP2X forum, GP32x (
http://www.gp32x.com/board/.)
As for the other capabilities of the GP2X-- it has quite a bit of quality homebrew software out and in the works, the emulation scene is fantastic-- there are now full-speed NES, Game Boy, SMS/Game Gear emulators that run at about full speed with no emulation (the NES emulator only needs the tiniest touch of it, and won't soon.) MAME emulation is quite excellent, supporting about all games from v0.35 and back. Neo Geo MVS emulation runs at full speed with a reasonable overclock (~266 MHz, almost every GP2X unit reaches this speed.) As far as I know, the PSP has NO full-speed NeoGeo MVS emulator. There is also a PSX emulator in the works that is progressing nicely. Amiga reportedly runs rather well, though I haven't used it yet. MegaDrive/Genesis emulation runs at full speed with only a small overclock. At default speed and 1 frameskip, it's perfectly playable, and the frameskipping is nearly imperceptible. SNES emulation is coming along well and is close to full speed, albeit without transpencies. (These don't distract from the gameplay for me.) The GP2X's screen aspect ratio is quite superior to the PSP's for most emulators.
Its multimedia capabilities are also excellent; it handles MPEG-4 videos e.g. DivX and XViD in exemplary fashion, as well as playback of even high-bitrate Mp3 and OGG Vorbis audio files. It has a built-in picture viewer that handles most major image formats, zooming, scrolling, flipping, etc. for photo or general image viewing. There is also a text viewer built in.
The main advantage of the system is that it is fully open-- anyone with an SD card can develop anything limited only by their own skill.