In theory, PS3 is the better system given it specs. Unfortunately, the PS3 does not fully utilize it's amazing processor and graphics capability.
If you're more of a casual gamer who enjoys watching high def movies, go PS3. Amazing picture quality and Blue Ray is beautiful to watch on a high def 1080p large television. The Uncharted series look amazing in 1080p and MGS is a classic. PS Home was very anticipated among the PS3 owners but became a whole disappointment at launch.
If you're more of a competitive gamer, such as I, go with Xbox360. Yes, you pay money for online, but it is the best online console experience. Xbox live has an amazing interface and is so easy to move through. There is a reason why MLG uses Xbox as the major console in their competitions. Exclusives are amazing: Halo, Gears, L4D, Mass Effect .. etc.
I worked in the gaming section at Best Buy for almost two years. I have pretty good knowledge of both systems and I have the Pros and Cons list in my head because so many customers pester me on what system to buy. This is exactly what I tell them.
I'm not a Microsoft Fanboy at all. Given the hard facts, sale records, and consumer reports, Xbox 360 is overall the better gaming system. This is my unbiased opinion.
@IcyDeath: If you enjoy Modern Warfare 2, the gameplay on both systems are similar but Xbox Live will always have more players online so it may be an easier to find matches. I remember on the day after release, there were over 800k players online on Wednesday at 11am in the morning. Those are some crazy numbers.