Maybe he means the songs are 8KB each?
Though I'm a bit confused what the problem is if the files are 8MB a piece or why bits are being used.
As for songs being bigger than game, the same is true for PDA's. I think they use lots of software compression and the like. I was surprised how far my initial 64MB went.
Songs are compressed in a different format and any sound file is relatively large anyway. Buy some kind of expansion card/memory stick that is compatible with a PSP. They should be quite cheap (unless Sony forces you to use one of it's own brands
).