The Psionicist's were play balanced in combat against similar PC's and monsters. The problem was that since they run on power points that they can spend freely on high or low spells (with the differing costs of course), they can manifest their highest level powers a lot more per day than the other classes, at the cost of the little ones. So they were play-balanced in single combat situations. This leaves them drained though. Imagine if Sorcerors could add up lower spell levels (Like a level 1 splot and a level 2 slot) to use higher powers more often (like fireball). Sure, they'd be devastating in a single encounter if need be, but for the rest of the day they'd be nearly useless.
I find that the psion's are a little underpowered as such, since no player in his right mind is going to use all his high level powers in the first combat and drain his character right away, which the playtesting inadvertantly assumed.
What can be good for a group with a Psion is that they can be really good "pull yer butt out of the fire" characters. If things go unexpectedly bad in an encounter then the psion can use a bunch of his higher end powers and make a big difference at the expense of things further on.