Note: These are my favorites that I actually played. It's not meant to be any sort of comprehensive best-of list. You can see I'm a fan of RPGs.
Star Wars: Knights of the Old Republic II: The game mechanics are almost identical to the first game released in 2003, quirks and all. Like the first, KOTOR II has a great storyline and interesting characters. The combat system is passive, which takes a bit of the fun out of it. And, this may sound like a strange complaint, but the game is a bit long. It's quite addictive, so it will take over your life for a while. It took me a bit over 40 hours to complete, although one of my coworkers finished in 32.
Sudeki: This game seemed to be a bit underrated. I liked the visuals, the storyline, and the characters. The combat system was good and the storyline forced you to use different characters and combinations of characters which made you have to figure out all of the different fighting styles.
X-men Legends: They did an excellent job translating the X-men characters and their powers into an RPG using the Baldur's Gate engine. It supports multiple players, which was a nice plus (although there are sections of the game that are single player only). It supports HDTV (720p), so the graphics are very crisp.
Fable: The big thing hyped about this game is how you can choose to be good or evil and how that affects game play. This is definitely a huge aspect of KOTOR as well. Fable does things like change your appearance and change how crowds react to you. This was kinda neat, but was a bit gimicky at times. However, it did have a pretty good storyline, and I liked the combat system. What I found I really missed compared to KOTOR, Sudeki, and X-Men is that you only play a single character instead of having a party of characters.
Star Wars: Battlefront: This game is a lot of fun, especially with multiple players (haven't tried X-box live yet!). You can fight in any of a large number of battles from the Star Wars universe as the Rebels, the Empire, or the CIS. What's great is that you have a lot of flexibility in what part you want to take in the battle. You can pilot a vehicle like a snow speeder or X-wing, or you can be a grunt shooting at Storm Troopers. There's a lot of detail in the game.
One obvious game missing from the list is Halo 2. I actually don't have it yet! I've been trying to avoid getting sucked in. KOTOR 2 took all my time over my holiday break. I also haven't had a chance to try Bard's Tale or Demon Stone. I'm not sure how those are.