i'd recommend the 360, then again i'm a tad bias.
i mean the hardware issues were only really there early on, all modern consoles have teething issues.. there are quite a few with the PS3 hardware atm too
there's much more available for the 360, plus it has many very established systems in-place right now.
you have a large game library, with xbox back-compatibility.
xbox live (marketplace, arcade and gaming.. soon Messenger & .TV)
it's fairly portable; as you don't have to reset it to SD-RF each time you want it on another TV.
you can flip between AV modes without rebooting the console.
HD Sound works, period. try setting it up on the PS3 is difficult to say the least.
arcade has a new title each wednesday
most games are being released on it either multi-platform or as exclusive content .. PS3 only has a few guarenteed exclusive.
the back-compatibility with the PS3 is "temporarily" disabled for UK machines right now. no clue why
DVDs are crystal clear even in SD modes, using Avivo. PS3 everything looks fairly poor in SD modes; it's like playing a full-screen windowed mode DBP app.
xbox dashboard is easier to navigate than XMB, the XMB isn't really good for complex systems which the PS3 impliments.
rumble on controllers, which the charge lasts for more than a few hours
price of additional hardware is much cheaper.
i dunno, the PS3 is alright; but certainly not enough to warrent the £600 price-tag.