The PS3 certainly has more processing power, but I think there are other factors.

I also think that Sony has an extremely stong 1st party (and "2nd" party support, ie incognito, insomniac, naughty dog etc) how can you discount God of War, one of the greatest games ever. Uncharted, possilby the best looking game that anyone has seen (I know people say Crysis looks better, but that requires you to spend a couple of thousand on a computer) which is Sony published. Resistance and Motorstorm were the two best games at launch, both published by Sony. Sony, in my opinion at least, has the strongest 1st party support. 

However, talking about ports, I think that soon these multi-platform games will start to look better on PS3. I know that at the moment many developers have delayed their PS3 games, but this is probably to get it right for the PS3. It's because the PS3 is hard to develop, and the devopers have already had a year of the 360 to learn how to get the most out of the system. Games like Mercenaries, where the PS3 is the lead system, is where it is going. Once developers see that they can get more out of the PS3, they might take that as the lead, and make a weaker one for the 360.

@ NJ5

To use the PS3 fully to its potential will take many years as the platform has a lot of headroom for developers to tap into. Motorstorm and Resistance are two examples which currently already use the SPEs. I know Resistance doesn't offer on par graphics with Gears of War yet, but according to Insomniac games that's mainly because the engine did not yet support texture streaming, which will be included in their later games. Personally I completed both Gears of War and Resistance and I honestly think Resistance is the better game and there are parts in Resistance later on with so many things going on at once it's really impressive without dropping frames and unlike Gears of War bodies stay around making the game look like a graveyard, windows partially break very realistically, soldiers follow your movements with their eyes, bodies can be pushed off ledges in a realistic way showing off good physics, etc, so overall I don't think Resistance is technically less impressive than Gears of War. Sadly screenshots don't show off Resistance and Motorstorm to the quality they are really offering, but the graphics are very good and their online component is very strong as well.

There are quite a few large budget PS3 exclusives under development.

Often concept art already is of very high quality, later downgraded to fit the game. On the PS3 there is less reason to make compromises if the engine allows for good performance in combination with higher quality textures.

@ Diomedes1976

I think you are right, just look at the wonderful graphics together with good performance Genji 2 delivers, that game is confirmed not to be using the SPEs at all. So even without tapping into this huge  fllexible  (graphics, physics) performance potential games can look amazing, on par with the best graphics we have seen in XBox 360 games so far. But other than graphics IMO Genji 2 isn't that impressive regarding for instance physics and AI and general gameplay.

@ Munkeh

PC games may offer even higher resolutions but I think we will be getting to a point where higher resolutions (beyond 1080p, you will need a very very big display and sit very close to it to notice any difference, not recommended for your eyes) and maybe more effects won't matter so much as compared to enhanced physics, AI, huge environments and game complexity. At least with regard to realistic games I think overdoing it with effects may actually result in a less realistic game. The fully destructable environment talked about with regard to Killzone sounds really promising, no longer while firing a rocket at a tree it will be left standing as if nothing has hit the tree, a tank won't be stopped by fences or walls. Folding@ Home is a good example where the PS3's Cell processor is able to outperform massive calculations done by the PC CPUs 20-30-fold.

The PC gaming market has shrunk roughly 40% these last 5 years, so there's less reason for game companies to justify dedicating their resources on getting the most out of PC graphic cards. I can't speak for others but personally I am done with constantly upgrading my PC for playing the latest and greatest games.

Hopefully Epic's UT3 will be very impressive on the PS3, afterall Epic is trying to sell their game engine to other developers. Although Resistance is excellent to play with a game pad, IMO it's a positive sign UT3 for the PS3 will support keyboard and mouse, as like I said I am not intending to upgrade my PC yet again before it breaks down.

 I really don't see the point in spending alot of money to upgrade my PC constantly to keep up with the newer games that require more power, and so the only games I ever buy for my PC are RTS. Every other I game I now buy for my PS3, becuase I don't have to worry about whether it will work or not, and generally it looks better on my 32" TV, not many people have proper TVs connected to their computer and, altough people say it is easier to play a game with keyboard and mouse, the overall gaming experience is better in front of a big TV. I don't see why a developer would not simply release the game on PS3, and if they do not to make a control scheme for the SIXAXIS, then they simply say that it must be played with a keyboard and mouse, which only cost a little but more than the SIXAXIS anyway.

First to start on the multiple disk agument. Sure multiple disks are ok for an RPG, and mabye a GTA, but when you will be looking attwo and mabye even three disk sports games then it starts looking bad. Everybody talks about MGS4, and Kojima said he will fill the blu-ray and go further if a bigger 100GB disk is availbe. Say he only uses 48GB that would require 6 DVDs, and that is unexeptible. Sony has already done a great job of helping 3rd parties out with the Playstation edge dev tools. This help should be showcase in late this year to early next year. Due to this I believe EA first of all will switch to PS3 as lead skew. They already know 2 disk madden, NFS, Medal of Honor are inevitable in the next 3 years, so I believe they will just start now. With Sony bringing back rumble later this year that gives people less reason not to play the PS3 version, and with home being = or > live that will pull a lot more people.

Yeah, the ones who were dedicated to the 360 from the getgo and bought that HD-DVD drive should learn to bite the bullet, I mean, business tactics should prevail from customer satisfaction is what I'm getting from your post.

I don't like discussing "what ifs;" those things are great for fiction writers. I follow "what is," and from what I'm seeing and hearing online, it's not Blu-ray that's getting a beating.

Here's a what if scenario: the 360 launched with an HD-DVD drive.

Sony is in a very difficult position right now with their PS3, but they brought it upon themselves.

The price is one thing, but MSplayed it safe dor now, with their XB360, so people are waiting to see what happens. There's a LOT of FUD (Fear, Uncertainty and Doubt) coming from the MS camp, and it's not fortuitous (I'm not ready to believe it is) as this is a common MS tactic.

I'm waiting to see if 3rd parties bite into this FUD or not. And basically, that means is FFXIII going to be PS3 exclusive or not ? I believe that if FFXIII is confirmed to be a PS3 exclusive, sales of PS3 will explode (well, with a price cut).

The FUD from MS is powerful (as always with MS FUD) but if you think for it for 10 seconds, it doesn't hold. The XB360 is for hardcore shooters fans. All the best game sales  on this console are shooters. Online is perfect for this type of games, highly detailed graphics too, "physics" too.  These are also very good for racers. But that's about it. Problem is, shooters of this type are not the best thing japanese  people prefer, far from it. Hardware wise, the XB360 is even further from japanese tastes (unreliable, too big, ugly, ...). So the sole thing saving Sony right now, is the japanese market. Because westerners won't think twice if FFXIII goes to the XB360.

It's not so clear for the japanese. I was saying Mystwalker were fooling themselves by trying to "save" the XB360 in Japan. All they're going to do, is dilute their new franchises. And I doubt releasing an Anime (that doesn't look like to be a killer at all, but rehashed material) will change that. I'm not surprised that japanese people sell their XB360 once they finished Blue Dragon. It's no good sign either, because they sell it before Lost Odyssey is even out. Must be the reliability problem, but it also shows Blue Dragon has nothing compelling.

So I see the biggest hurdle that PS3 will have to overcome, is that game of attrition that MS is playing. The good start in Europe is a very good thing for PS3, reassuring 3rd parties a bit.

Now, they have to convince Japan, and everything is on the shoulders of Square IMHO. Which would not be a problem while Sakaguchi was there, but now that the big fanboy is out (yes, I mean Sakaguchi H., or is he just holding gudges for life ?), it's not so clear.

You're obviously trolling here, so I'm not going to waste any more time commenting on that...