I have had my Xbox for about a year now. Its one of the newer systems were the failure rate was drastically reduced, but still possible. So far I have put a lot of mileage on my system and have yet to get any problems. I did scratch one disc, but that was completely my problem. Otherwise I play most games off the hard drive now anyways, the ones I play a lot, and delete them when I am done. So me personally I would get an 360, but that's because it has a lot of games I enjoy. If I had a PS3 I would be playing at most maybe 4 games that are out for it at the moment.
Now as for games? Well that is all a matter of opinion and I hate when people list off their favorite games because just like any art it's debatable as to what you like compared to what another person likes. I loved Star Ocean, but I also know many people who thought it sucked. So when it comes to console wars it just becomes a never ending shit flinging battle were people hug to their consoles like the company has just made love to them. I find it quite hilarious actually
Now to the OP. Like I stated before if you are looking for an answer as to which one to buy you are not going to get a straight answer here. What you need to do is sit down and go through a whole bunch of different gaming sites and look at which console has the better gaming line-up FOR YOU, not anyone else, because 300 - 400 dollars is a lot of money to spend on a console you wouldn't play. Not to mention the 20-60 dollars per game you would be spending. It gets expensive out there.
So go through game sites like gamefaqs, IGN, Gamespot, ect... and take a look at the games available for each system and base your opinion on that. Not the nerd rages of the crazy console lovers on this website.