E3 is far from overstated. It's historic for the games industry, and contrary to what some want people to believe, nothing out there tops it for impact, importance or plain name recognition. Sony isn't not attending because they don't want to, they're not attending because they'd can't. If they were able to I'm sure they would. Whether that's for financial reasons or due to strategic reasons, also likely tied back to financial, is anyone's guess, but Sony clearly feels it is something they cannot afford to do.
Another theory is that they caught wind of some major decision or big move in the games industry and don't want to be in attendance after it gets announced. That's just a theory, but if you heard that a megaton of biblical proportions is about to be dropped by potentially your main competitor, would you want to be in attendance when that happens if you have nothing to counter it? That hasn't stopped something along similar lines from happening in the past, but maybe this one will top them all.
That's just all speculation. But no way in hell Sony doesn't want to attend E3.