Should Sony separte its gaming division?

No, That's just dumb. I think what sony really needs to do is revamp its TV division and stop trying to be on the edge of every format war/tech innovation. for every Blu-Ray there is the 3D debacle. I am no business analyst but I think that is where the majority of the bleeding is coming from, now its putting all their eggs in the 4K basket.

It's what will end up happening in the end anyway. The writing is on the wall with Sony. Their only able to stay in business right now because of creditors and paying the minimum back to those creditors. The moment they start defaulting to them they'll have to claim bankruptcy and start selling off assets. Playstation probably being one of the biggest.

The problem being that Sony is able to back projects and give them "funding" to create a title. Playstation on it's own can't do this financially, so they'd most likely be forced to sell to a bigger more established company to act as a publisher.

This is true. They've just quit trying to make OLED 4k TV's because they are too expensive, in favor of LED 4k TVs. I think this is a good idea, but its one that may bite them after Samsung lowers the production cost of OLED. But that is the future, they need to fight for today's profits.

The talk of Sony splitting the company is interesting, but the PS4 shares so many services with the mother company. I don't know how the financials of sharing those services would work in separate companies. Also the development time and cost (and therefore the sale price) of the PS4 might be different if the R&D had been shared by multiple companies within the division.

This topic is as dumb as when cows the say the same thing about the MS's gaming arm. Why would a company want to dump something that's making money? The only people who want that are short term investors looking to make a big profit and then dump and run.

Sony already has spun off its TV arm http://www.forbes.com/sites/marksparrow/2014/02/09/sony-spins-off-tv-business-in-bid-to-reconquer-market/

that is interesting.