The CELL is better than a standard cpu in certain number crunching tasks, as folding@home has proven. Would a multiplayer game server be something the CELL is better at do you think? Or is it general internet bandwidth which you think will hold back the 256 mutliplayer claim?
The cell in it's current form is nothing special but processing power is clearly not the issue here. Ram limitations are the issue and a memory management system that would make this possible on 256mb will be all over the news.