This is going off old memories so don’t take it for 100 gospel, but it’s my recollection of my youth when the consoles were in their life cycles.

PS1 chipping was/is very easy, decent sized pins/pads, depending on the chip it’s almost 8 solder points on the board (other chips had less solder points, it depended on the board revision and if you had a stealth chip or not). Any kid with a crappy soldering iron could install them. The code for the chips also got quickly “leaked” along with the methods the chips used so you could easily find chip code online and program your own chips using cheap microcontrollers. So basically there was very little cost (both in skill and cost) to get started chipping PS1s. So you had a very high success rate chipping them and a decent profit from each console (but as anyone who was so inclined could chip the console, it did lower the cost you could charge per mod. Me and my friend used to mod PS1s at school during our lunch break in the schools technology lab using the schools irons, solder and wire, me and my friend went half’s on a parallel chip programmer, so our overheads would be low, chipping PS1 was basically my first soldering adventures, that’s how low the skill bar was to solder these things in)

Once installed you just slapped a disc in the drive and played the game. (The early chips soon got “detectable” so game devs started putting copy detection in their games, but later chips started becoming “stealth” so would be much harder to detect and would play un-modifyed rips without issue, crackers would also bypass the copy detection in games so they would play on the old chips).

PS2 chipping started off slow, in the early days you would have to push button combinations to put the chip into the right mode for the game you were trying to play (PS1/PS2 CD/PS2 DVD), so the chips were not as user friendly as on the PS1. The chips would also need much better soldering skills to install as you needed to solder wires to some fine pitch ICs on the board. The chips were also more expensive as they required something a bit more “beefy” than the cheap microcontrollers used on the PS1.

So in the PS2 world (esp during the early days) the cost of installing the chips was much higher and they were not as user friendly. So imo the market wasn’t as large as it was for the PS1. (Plus I had started working and had some cash from my PS1 days tucked away, so I just got into the habit of purchasing my PS2 games.

That’s just what I remember, but its 1am, I’ve had a couple of beers, and this was all 20plus years ago so I may not be remembering everything 100% correctly.

Side note: Iirc, chipping an Xbox 1 was much easier than the PS2, and the Xbox 360 “just” involved replacing the firmware on the DVD drive for the console to enable backups so with the right tools (a PC, a ~£15 sata card and a screw driver, a bit later in the console lifecycle you also needed a serial port but a cheap USB serial converter would work, I used to use a cheap Nokia USB data cable with the end cut off and a sewing needle soldered to the RX line) you could flash all the 360s you could get your hands on (there was a decent amount of mail in work on the forums of private torrent trackers, people would open their 360, mail off their drive for £4~ first class recorded (in the UK), and get it back a few days later flashed.