It seems you're pretty set on a PS3, and I'd say go for it! There's some great exclusives coming up for it, if you don't mind waiting. But just in the interest of fairness I'll give you the run-down.
Xbox 360: $50/yr online services, in game messaging and chat, supposedly superior matchmaking services for multiplayer, but you're required to pay the $50 to play online. Demos, DLC, etc are available regardless of whether you pay or not. Xbox also has achievements, which a lot of people enjoy. The 360 has a huge selection of games out, but they fall into the rut sometimes of FPS, sports, or racing. Not to say that there's not other titles, but they're not as polished as the FPS/sports/racing selection. Also, to clarify on the failure rate, the 360's original shipment had a failure rate of >33%, but according to a recent study by an insurance company (who writes off the repair costs on 360s), it's closer to 16% with the newer models. Comes bundled with a headset, though requires first party add-on harddrive if you buy the Arcade version.
PS3 has free online play, supposedly getting in game messaging and chat (ie In-game XMB) in the summer, trophies (ie achievements) with the coming of Home, and some other perks like dedicated servers for first party titles. The library isn't as large atm, but the games are coming. Something like 180 titles are going to launch for the PS3 this year (including multiplats). Failure rate at ~0.2%, mostly because of bluray lasers, especially in particular batches of 40gb models. The 40gb model does not play PS2 games, but the 80gb plays ~85% of PS2 games. All PS3s play PS1 games. The harddrive is upgradeable with any aftermarket 2.5" SATA drive. The PS3 has wifi, the 360 does not, unless you buy the wifi thing for it.
Obviously the PS3 is the best bluray player, since it's upgradeable, and this month will be getting Bluray Profile 2.0. Check out blog.us.playstation.com for details.
The PS3 won't overheat on you if you give it 4" of space on the sides, and don't run it in a closed cabinet. If it does overheat, the system will power off and the system light will flash red until it cools down.
Neither system has a lot of wires if you use HDMI, since that carries up to 1080p signal with up to 7.1 surround sound, though I'm not sure the 360 has games with 7.1. The PS3 does.
Both games have beautiful graphics, though if you believe what you hear, the PS3 has further to advance in terms of graphics than the 360. Also, the PS3 natively renders games in 720p or 1080p (normally only first party titles get 1080p native), whereas the majority of 360 games render at less than 720p and are upscaled via a hardware chip inside [notable exceptions include Virtua Fighter, which is 1080p native. It's a PS3 port]. Not that you'd be able to tell the difference visually in most cases, but there is one.
Neither one is subscription heavy, just the $50 one time fee per year for XBL, and you can buy a card for that in the store for 13 months. DLC and games are extra on both systems.
Both systems can feature as media centers, though don't believe that other guy. Neither console can burn CDs/DVDs. You can store movies and stuff on external drives and watch them on your TV, or stream from your PC. The 360 has slightly better DivX support, though the PS3 is supposed to be getting an upgrade in that department as well (with FW 2.20)