Thanks for all the replies guys
The XBOX def sounds better for gaming.
I liked the PS3 because of the Blue ray.
I actually wanted to buy a gaming PC, but decided against it when I saw the price of a decent one and in 3 years would have to get a new 1.
Would any 1 recommend chipping a XBOX??
Will this shorten the XBOX's life span?
Hey dude, my thoughts.
First off, if you're a PC gamer the Xbox should be at the top of your list. Xbox games are more "PC'ish" than Playstation games. PC and 360 share common architecture so a lot of PC dev's are splitting their products to be PC/360 exclusives: Splinter Cell Conviction, Velvet Assassin, APB, Champions Online, C&C:Red Alert 3, just to name a few. So with the 360 you get the benefit of "console exclusive" games like Gears 2, Banjo Kazooie, Fable 2, Endwar, Pure BF:BC etc etc and "PC" games as well.
More reasons for Xbox:
Much lower cost of entry (60Gb Pro @R3000 versus R4800 for 40Gb PS3) Means more games

Much larger catalogue of games
Much larger local community (Means bigger aftermarket and more online games)
Superior controller (my opinion

)
On chipping:
I don't suggest it. Microsoft have before and will do another round of bricking. It also then denies you access to Xbox Live which besides just the gaming side of things means you lose out on things like downloadable demo's, Live Arcade Games and exclusive Beta Access.
With Consoles which you don't get on PC is a huge second hand and rental market which negates the need to chip, if you're just a bit patient. As an example, I've played something like 108 different games in 18 months having never chipped my 360.
On Blu-Ray:
I really don't think it's worth it. Never mind console wars, whatever, the benefits of BD are greatly exaggerated. Yes when someone shows you a near static in store demo it looks crisp and the specs sound impressive, but in truth the second stuff on screen moves it's a complete loss. There's a good reason the makers of real high end kit like NAD and Marantz never bothered entering the market - because a well upscaled DVD is virtually as good on anything under a 50" telly.
Sony need to make margin which is why the hype it so much.
If that doesn't dissuade you - remember UMD, Laser Disc, betamax and DVD-Audio. Don't go investing in a "Standard" until it makes it to mass market which means affordable standalone players are available.