"I've only ever noticed this in LBP, but wanted to know if anyone else has played a game that allowed PS3 profile logins?

In that I mean, when a second (3rd or 4th) person joins a multiplayer game on the same system - they get to choose a profile from the list which correspond to the profiles on your PS3 system. Once chosen that profile (in LBP) can have it's on characters saved, trophies and so on.

The 360 does this for most games and I've always liked the feature... and until LBP - thought it was something the PS3 couldn't do. SO! If it can be done why am I still playing with "Generic default name X" for just about every other game?"

Because the PS3 is in the hands of Sony.

I think this is what was mentioned in the playstation blog update about Resistance 2 patch. I think they were unable to do this, and because of it you can't save the progress of the second player. My guess is that they'll make it like this, so it'll be another game that uses the feature. That's my guess anyway.

But aside from this, I don't know any other game that uses it.