Well, to offer my two pence, I've read almost this entire thread and had Lucio not said it first, my suggestion also is to consider forgetting consoles entirely and focus on something else.
This is a conclusion I came to a couple of years ago. Though perhaps by no means a die-hard console gamer I have enjoyed many a gaming on experience on my or my friends' consoles. From the Atari 2600, where I still remember beating Q-Bert on a Saturday morning, I went to the Megadrive II with the magic of Ecco the Dolphin, and the standout, IMO, X-Men Clone Wars. After that it was the Sega Saturn featuring the excellence of Panzer Dragoon Zwei, Sega Rally, Virtua Cop 2, Dragon Force, Last Bronx, and with a purchased adapter, the multiplayer joy of Saturn Bomberman. The final console I owned then became the original Xbox, with the legendary Halo, Morrowind and others.
Some may argue in my game choices but I wrote that last paragraph with love and affection. I loved all of those games and the experience in playing them. I loved too fighting with my friends on other's SNES's in Street Fighter 2 Turbo, a little bit of Zelda, and on both Xboxes Halo parties, of course.
So many good times combined with such wonderful innovation often leads me to weigh up buying a console one more time and yet now I never will. The reason is that at price vs. longevity and possibilities vs. reality they don't last. Yes, consoles have given me some great times, but weighing the cost of the console, plus the games, plus the add-ons, and then knowing that it will only be a few years before things decline and the next, next gen is here makes them a bad investment in my book. And I mean that not only financially but also experientially. No matter how many pleasant memories I bring up there's always a bitter taste at the end. And I've learned that that's too bitter a taste to keep on drinking.
Drink it if you want, but I'll be at the bar drinking something else, with different tastes and pleasures and no bitter twist at the end.
You've said, Saracen, in response to the suggestion to buy a PS2 that you don't want to buy last gen. My argument is, that with consoles, last gen always come too soon. Certainly they're making consoles backwards compatible now but the fact is that in console gaming nothing last forever. If you're buying a console then even if you buy the newest you're still buying last gen.
Second, someone else made the point that they bought their console, 360 I think it was, partially with the consideration of being able to buy and download older games and yet that (for no real reason) hasn't happened. I remember it too. A world of options and possibilities, but in the end, for most people only about twenty percent of those get explored.
Third, although at times I wish I had kept some of my old consoles - I have friends who have - the fact is that most of that is just nostalgia. If I had them I know I wouldn't play them very much. I just get occasional longings for one game or other. It passes quickly though. And it's that knowledge that allows me to keep perspective and take my stand.
Fourth - and here's the financial side - last gen means dead weight. Sooner or later the older ones become dead weight - in the case of the Xbox really heavy weight You could flog them on Ebay, but let's face it, the resale value of consoles is probably worse than that of new cars, you lose money. You could sell early and make more money back but most people don't want rid of them until they see the new thing coming and by then it's too late. Plus, if you're flogging your console early, that's just another situation in the world of console dreaming where the idea fails to come to pass.
As I said, they've brought me some joy have consoles, some wonderful experiences, but I've decided that in the current industry they are, sadly, beautiful things but fatally flawed.
Okay, the alternative. Lucio mentioned books, but here's my gaming alternative - which has also yielded many happy memories, much multiplayer fun, and when you take a look at it, lots and lots of creativity and variety. What's more, it's fatal flaw is also, potentially, one of its best assets.
My suggestion is, using the term loosely, board gaming.
I've always liked the odd game here and there but it wasn't until a very good friend of mine, who happened to manage a gaming store, opened up the options for me, that I found out what's really available. and it's mind blowing really.
Don't just think Monopoly, Risk, or D & D. If you can, bear with me and hear me out.
There are games out there - board games and card games - of every variety. Light and fun like Wii party games. Strategic and challenging for an intense night of interaction. Adventurous and funny. Action based. Mystery based. Management based. Or 'your friends' based. You name it. They can be very simple and easy to pick up but offer lots of replay value and nights of fun. Often they are humorous and rather witty, giving for some good laughs and good times (most if not all of these games made by intelligent people with a love of gaming good times). In fact, it's not always a great step away from the video gaming world. Often you'll find references back into gaming culture and love the interplay.
The other advantages of 'table-top gaming' shall we say, are one, the fact that rather than buying a base system and then games for it, you are simply buying the games which play by themselves. This is arguably board-gaming's biggest flaw - they are what they are. Whilst if you pick a winner you're sorted for a long time. If you pick a dud, it's a bit of a waste.
Two - You aren't limited to compatibility but can pick and choose for yourself as it suits you. Neither do your friends have to be limited either. Variety and choice are vast, and anyone can also come in as a newcomer.
Three - The cost is considerably less.
Four - You'll keep a good game forever, able to play it any time, anywhere, with less stuff to cart around, no worries of it ever burning out on you etc.
I know table-tops games aren't the same as video games. However, I would suggest to you Saracen that as a gaming alternative table-top games may well exactly fit the bill.
I don't know what your preference runs to but for starters I can definitely recommend these:
The 'Munchkin' Series - amusing and highly interactive card game. A bit more for gamers than non-gamers, but given a group of jolly gamers, this one is fun. Can be a bit long depending upon how many players you throw in.
Carcassonne - extremely popular tile based game. Sounds boring but isn't. Simple and tons of fun. Expandable and tons of replay value. An hour +
The 'Catan' Series - this one is a personal favourite, I own all three version and have converted lots of people to its ways. The original won game of the year in 1995 and is still going strong.
A Game of Thrones - Strategy/Adventure
Runebound - a popular adventure/action game.
Puerto Rico - a popular strategy/management type game. Very good.
Bang! - a western themed card game.
Apples to Apples - a card based party type game. This is one which creates many surprised converts because it's deceptively good. I could describe it but it may well sound crap, but play it with some good friends, or even acquaintances, and it's value will be proved.
James Ernest's Totally Renamed Spy Game - a personal favourite for a quick, fun game, especially being an old Bond fan. It's 'totally renamed' because it was originally released as "Before I kill you Mr. Bond..." The creator's figured there was a chance they'd get told off, and when they were issued a Cease and Desist order, they had to change the name. Nevertheless, the game is a fun card game where each player has the part of being a master villain attempting to kill of any number of Bond-type spies invading their lairs. You can do this quickly and efficiently but where's the fun in that? As evidenced in Bond and many other movies, it might be risky, and often fatal, but it's much more preferable to try to rack up more points by delaying the coup de grace and monologuing for as long as you think you can.
Thief of Baghdad - Had enough of the Prince for a bit? Take an over the top view point and play this game of the year finalist instead.
Alright, I could go on, but I'll end the essay here. For some good time gaming alternatives that can give you a laugh, a distraction, and/or something to think about, and that have high replay value, and are especially good with friends table-top gaming is my suggestion to you!
Take that money and invest a few but various recommended games. I don't believe you'll regret it.
For reviews and further research try here:
http://www.boardgameratings.com/index.php
http://www.boardgamegeek.com/newuser.php