One of the best years!
Sonic Generations is in my opinion the greatest platformer ever made. Can't think of another game that has so consistently outstanding level design. Rayman Origins is another one from the same year that is also among the greatest platformers, and I actually prefer slightly to Rayman Legends. Portal 2 also almost got my vote, as I just think it has perfect game design, writing and pacing. But my vote went to Skyrim, open world RPGs are not my go to genre of games, but this showed how it is done! Could never get into Oblivion, but Skyrim made everything a bit more polished and approchable. I am fascinated that you can make a game with so many systems and not make it feel overwhelming, it does a great job encouraging the player to interact with the different systems and rewarding them for doing so, but also without making them feel punished if they don't. So many modern games throw in unwarranted upgrading and crafting systems that are just a tedious chore to interact with, but Skyrim does it seemlessly The open world is also exceptionally well designed. I think one of the reasons many newer open world games fail, is because the worlds just get bigger and bigger. Skyrim is the sweet spot.
Other noteable games:
L.A. Noire - perhaps Rockstars last masterpiece (though I might change my mind, as I am playing through Max Payne 3 for the first time now and I having a great time so far).
The Legend of Zelda: Skyward Sword - Very good, although flawed game. It is a bit strange, as I think it is probably the only Wii title that really nailed motion controls beyond just waggling or pointing. But the motion controls are also the reason I am less motivated to play it again. The dungeon designs, story and art style are among the best in the series, but the game has a bit of a problem with pacing, it could have been shorter and it would have been better. Certainly an overhated game thoug.
Minecraft is really not my thing. Arkham City I only played a little bit, and for some reason I never played a From Software game period. Gears 3 is alright, but significantly weaker than the first two (and probably 5), the setting and tone just felt kind of bland. Finally, great kudos to Mario Kart 7, to get that franchise back on the right track :)