I would strongly reccomend 360, as there just aren't enough compelling exclusive for the PS3 to warrant the extra 200 dollars, and the PS3's graphics are really not that much better, if at all, than the 360's.
Plus, you can use the extra 200 to buy a Wii.
edit: No, 360's don't look bad on NTSC sets, the image just isn't as sharp. Which I guess is true for pretty much everything when it comes to HD.
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