Thanks for all the info guys. My kids do not know that we'll be purchasing a gaming console for them and it was with great difficulty that we had to try and find out what they would prefer, without letting on what we have planned. Also it was a very tough decision to decide on which console to purchase in the first place

, as both units have their pros and cons (and they don't come cheaply), as well as for me to get to this point, leaning towards the XBox 360. There will always be someone preferring one unit over the other, so at the end of the day it comes down personal choice.
The blu-ray is not an issue for me, as all movies are watched via media player and my dvd player hasn't been used in years. A work colleague who has a PS3, has never used it to watch movies, and he had his for about 2 years now.
And from what I've read, there are also more games for the XBox360 than for the PS3, as it is easier to write games for it (and XBox 360 games are cheaper

). My only concern really was for the Kinect, but it seems from the responses here, that most people are generally happy with it.
One other question though (just out of interest). The colleague that has the PS3 says that he attaches his wireless controllers to the PS3 unit to charge them and while they are charging, he can continue playing his games with the controllers. Can the same be done with the XBox 360?