I can't see the PS3 closing the gap within this year, I see the 360 opening the gap in NA and the more momentum they gain the more difficult it's going to be for Sony to catch up. Add to that strategy a possible price cut on the right moment and you have a very powerful system...
And by the way, I forgot about Project Gotham 4 or Shadowrun, two more 1st party titles for this year.
Ok that's Oblivion (which has the new expansion tacked on with more than 50 more addition hours of gameplay), F.E.A.R., Armored Core is exclusive for the time being, and Spiderman 4.
The only 2 with 2008 release dates are FFXIII and GT5 (which should be early in 2008, originally they were both scheduled for December).
The list is still hefty for 2007 even with the removals. I'm not saying they will close the gap, but if you look at both lists at IGN Sony has more. And Sony has more with confirmed dates too.
*If* Microsoft lowers their price so will Sony. That's a given as Sony won't even try to test the waters being almost 300 dollars more expensive. I don't see them opening a gap, I see it staying about even. They might be able to open it by 500,000 consoles but I don't think anymore than that.
SCEA is the third lagest game studio in the world, there for they will always have more first party titles than M$ or Nintendo. They are only behind EA and Ubisoft, both of which are massive.
Counting in the 2 other territories I actually see PS3 narrowing the worldwide gap with 360 this year.