Not exactly. With an E1000, you have to use the PC to go on the PSN, buy and download the game, then use the Media GO tool to transfer it to the PSP using a USB cable.
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You use the Media GO! program on a PC, you buy the games from there and it transfers them to the PSP via USB.
Yes
The e1000 has no wi-fi.
No, the budget 'e1000' version is not wi-fi enabled.
Because the PSP E1000 has no wi-fi, you have the following choices, A) Some later UMDs can actually install the latest firmware themselves. B) Connect the console to a PC, you can download the update via the Media GO! tool.