I was coming on to say YABU, but after reading the whole thread, I think you should cancel.
That's really quite shocking behaviour from a boy his age. He may well be easily led/have been carried away by showing off, but all the more reason for him to be shocked out of that behaviour.
I have so much sympathy for you, you must feel absolutely sick, but he needs a consequence he'll remember - one that will really sting, unfortunately.
We love birthdays in our house, we do big celebrations that are looked forward to for months, but I can honestly say that if my DD behaved like this I would cancel her party.
The other boy has lost something irreplaceable because of your son, a family item full of memories. I think your son deserves to lose something the equivalent, and a tenth birthday party seems about right. We all need to learn from mistakes. A PlayStation can be bought again, but you only have one chance for a tenth birthday party - it is irreplaceable, just like the item he destroyed.
Harsh perhaps, but this is the culmination of a year of deliberately silly, attention seeking behaviour. I think you need to address the root causes of that behaviour, but at the same time he needs to learn that no matter what has been driving him,his actions were totally unacceptable