I've just got hold of a GP2X with a view to porting over "Legacy", my in-development emulator for bootable IBM PC games, which currently runs on Linux through SDL. A successful port would enable playing of early to mid 1980's bootable PC CGA games such as Kings Quest, Archon, Flight Simulator, Infocom text adventures etc. An approximate selection of games this emulator aims to run is at Retrograde Station (http://retrograde.trustno1.org/). Note that you won't see anything like Doom, Quake, Dune or indeed anything requiring 80286+ or EGA/VGA running on this emulator.
However the emulator does not currently run DOS, so emulation of games launched from the DOS prompt (i.e. EXE files) is not currently possible.
As previous people on the thread have said, don't get too excited - emulation of the 8086 (the processor used by early PC's) is really time-consuming. In fact the quick port I did to the Compaq Ipaq (a 206Mhz ARM based device) a couple of years ago was excruciatingly slow.
Having said all this, I'm not wishing to put this project on the chopping block before it's even started - it may be possible to utilize a combination of GP2X hardware, dirty hacks and high-level emulation to get a specific selection of these games running at a decent speed on the GP2X.
The project website is
http://www.shinelife.co.uk/ and I'll post any significant updates on this board.
Cheers
Jon