If running unsigned code on a client...
"If the security on a PS3 is compromised and it can access PSN unfettered, that represents a threat to the PSN security and any threat to that is a threat to the security of my financial transactions and information held within PSN."
If someone else running unsigned code on a client machine can expose your personal or financial data then Sony have dropped the ball and deserve to be sued for negligence.
It's that simple. If you're any sort of IT professional then you ought to know that relying on client security in a situation like this is a recipe for enormous, embarrassing and costly failure.
As for the rest -
"people who think that their actions have no consequence. Just like Geohot though that his breaking into the hypervisor had no consequence. Yet it did, it resulted in the removal of OtherOS."
Yup, what a wonderful reaction from Sony, someone finds a way of modifying the hardware to gain hypervisor access so everyone loses OtherOS. Except of course that PS3 slim models had no OtherOS anyway and it looks for all the world like Sony were looking for any excuse to drop it. Either way, it's not a proportionate response and is questionable in terms of legality (see ongoing lawsuits on OtherOS, not that I have any faith they will come to much).
Geohot was in the right, IMHO. Your blaming him for losing OtherOS is like blaming a free-speech advocate for the resulting government clampdown after they speak up.
"Downgrading your firmware back to a version prior to these is great and all, but things move, games get released, new firmware is mandated."
Sure it is, but much new firmware doesn't add anything and the games simply check a version number, this can already be spoofed. Games that genuinely require new features will probably be supported in time too, through the use of custom firmwares and further exploits.
"The PSN is Sony's network, not yours, the firmware is theirs, the encryption keys are theirs and the stolen service key that was cloned to allow the jailbreak exploit is Sony's too."
Actually, that specific instance of the firmware, within the limits of copyright, fair use and other relevant laws, is mine to do with as I please. Well, it is in my book, Sony would probably disagree and they can probably afford enough lawyers that anyone actually looking to do anything with their firmware ought to be careful.
And the exploit doesn't rely on a clone of anything, it's an exploit that mimics plugging and unplugging a few USB devices to overflow the stack and then inserting code in just the right place to get it executed. It may have needed a service jig to find the exploit, but the exploit itself doesn't rely on any copyrighted stuff.
This downgrade stuff may indeed be based on a stolen or 'borrowed' service jig, nobody knows yet as it appears to be all hype.
I don't necessarily disagree when it comes to the PSN, it is Sony's network to do with as they please and they may choose to boot people off that they consider to be pirates, or who have the ability to run unsigned code and could be running bots, cheats, trainers or whatever else.
However your reasons not to want compromised systems on the PSN are unbelievably dumb. Sorry, but they are.
Personally I really like what happened on the PSP - custom firmware arrived that allowed you to boot into homebrew mode, which Sony could detect and not allow network stuff to run, or into original mode which would get you online but not allow hacks.
And the reason I attacked you character was because you seemed genuinely angry about people gaining access to their devices and genuinely gleeful at the idea of retribution from on high. By a huge corporation, on hobbyists. You seem to delight in the idea of authoritarianism and that's usually not a good thing in terms of character.