I voted Lost Odyssey.
Valkerya Chronicles is a great game, one of the best gameplay systems I have seen this gen, and a great artistic art style. However the game is short (beat it in 25 hours), and the story is only good, nothing special.
Lost Odyssey is a much longer game (took me 60 hours to beat it including a 3 hour DLC). It has better graphics, and just one of the most polished and immersive stories I have playing in a JRPG. This is a classic turn based JRPG, and Hironobu Sakaguchi really made a game to the quality of older Final Fantasy's.
It's battle system is also addictive. It's as if this game came straight from the SNES era, and if you ask most people, SNES/PS1 era JRPG's were the best. The main character is a bad ass, each individual character feels important in their own way, and the ending is one of the best I've seen in a JRPG. Just a flawless JRPG, in a time where they are no longer appreciated.
That said Valkerya Chronicles is my favorite PS3 game, but it just doesn't hold a candle to Lost Odyssey.
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