I don't know how production companies have a chance in hell of recouping some of their huge game budgets by normal sales.  I understand that big budget games like Resistance and Killzone 2 as well as Halo 2 and Gears of War will have been given some financial help from Sony and Microsoft, but what are the standardised budgets for Next Gen games?

Resistance apparently had a $20m+ budget, Killzone 2 is running on a budget of $21m, Gears of War was done on the cheap at around $10m, probably down to the fact that the game engine was already built as such by Epic.  Halo 2 apparently had a huge budget of $40m...thats ridiculous.

But what about other games, that may very well not get financial help from Sony or MS....MGS4, what kind of budget will this game have and FFXIII will surely have a huge budget.

On another note, Crisis Core will be released soon for the PSP.  This game has been in development for over 2 years and surely the budget for this game, must be pretty big?

I can see this only getting worse, as games try to keep up with other big budget games.  The real winners will be the Wii and DS in my honest opinion as development costs and time for the Wii will be on a comparison with the PS2 and the DS's production costs must be very small indeed.

I wonder what the average production costs are for a 360 or PS3 game and what they will be for Crisis Core?  Can anyone help me out? 

I think you got mixed up. I thought it was Killzone 2 that had a budget of $40 million and some 135 developers working on it?