i have a modded PS2. The thing works great.
I bought the USBMOD which is a little chip you plug into the USB port on the back. You have to soder 1 jumper wire to two points on the board and thats it. You do have to use a gameshark 2 to first boot the system, then you flip the mod switch and insert the backup.
The reason I got this version is because there is only 1 wire with two points you have to soder. The new NEO4 which eliminates the need for swapping and Gameshark has 33 wires that must be sodered to your board. I didn't feel like taking that chance with a $300 piece of hardware.
Be warned, though, this method is not effective yet on the new 4000 models on the shelves now. My friend tried this setup and it didn't work. The gameshark wouldn't boot. We spoke to the makers and they said that the new 4000 boards were causing problems and they are finishing the latest version of the Gameshark that will be compatable. He expected them to start shipping by the end of November. Also, the newer models (the 4000's again), wouldn't boot up old PSX games. We contacted the mod chip maker and they explained that the laser on the new units had been tweaked and will only read blue or black bottom discs. This was Friday, and my friend was going to try using a black bottom CDR this afternoon.
But, it you can get either of the first two models, (SCH-3XXX; number starts with a 3 anyway), then this method works fine. I personally have been running this setup for two months, and my roomate for four months.
Another problem with the latest version of the PS2 hardware is getting it opened and taken apart. With the original model it is simply unscrewing a couple screws and lifting off the top. The new 4000 model is a pain to get apart. The top lifts off and then there is another metal plate with ribbons everywhere. It took us awhile to get it apart since we were pretty delicate and didn't want to break anything.
I would suggest finding a used PS2 either around town or from the F/S board here. They are easier to mod and play all CDRs.
Hope this helps...
If you need more info, PM me. I'd be glad to offer any advice.