I recently had an Xbox 360 give up the ghost. After it happened it thought about whether I should buy another of Microsoft's failure prone console or go with a PS3. I then thought, maybe there is a third way?   

I have always primarily been a console gamer. It's not that PC gaming has never appealed to me. In fact  I've always been envious of the perks of PC gaming. The biggest of which in my mind being all the free community created content.  I've just never had an up-to-date game worthy rig. Part of my reluctance has always been the idea that it takes quite a bit of money  in hardware to stay current with games. However the 360 and PS3 are spec'ed exactly the same now as when the first one rolled off the assembly line and I was still quite satisfied with the visuals of my 360 right up until it died. Many of the AAA titles being released on consoles also have a PC release.

So it stands to reason that I could build a PC that is at  least as powerful as the 360 fairly inexpensively (under $700) that could play multi-platform games for as long as this console generation lasts with visuals as good  or slightly better. Now I do realize that their is optimization that goes on with console hardware that helps make the most of the platform has to offer. I wanted to know if there was obvious fallacy in my train of logic? Something I'm missing that would make my idea illogical?

Sounds like a good idea. You could definitely build a powerful computer for less than a $1000

Dont mean to stir up any controversy but I always thought of the PC as the xbox360 but so much more..... 
 
 
These days most GFX cards have some way to do HDMI out, mix that with a xbox350 controller and you're covered for the games that have more of the console experience.

" Sounds like a good idea. You could definitely build a powerful computer for less than a $1000 "

You probably could end up with better than the setup I have (which I paid $720 in 2008 for the CPU, motherboard, video cards, and RAM - the remaining components I already had and you may too, if you don't mind scavenging your old computer) for that sort of money.  I would make the assumption you already have a serviceable keyboard/mouse/monitor/speakers too.
  
Intel Core 2 Duo E8400 (you might want to look into i5/i7 solutions at this point)
Asus P5Q Pro (as above, might want to find an LGA1366 solution for i5/i7) 
4GB (2x2GB) DDR2 800MHz  (faster RAM, and perhaps DDR3, may be available for comparable prices. Don't forget to get matched pairs for dual-channel or matched trios for tri-channel)
2x ATI HD4850 in CrossFire (at this point, this is likely no longer the most cost effective solution. You may want to look at budget HD5000 series cards, and if you're patient, nVidia Tesla to come out - competition may slash prices)
 
Those are the components that were new at that point, with an existing case, hard drives, optical drive, and power supply. Note if you're scavenging your old computer for these parts, especially if it was a pre-built, that you check your new stuff doesn't outstrip the power supply's rating. I like this tool: PSU Calculator Lite

As I mentioned, I [re]built this rig in 2008, for not a ton of money. After the 2006 shift to Shader Model 3.0, there hasn't been a great deal of change to the current graphical paradigm. With all the extra power GPUs are breeding with little to do (except push more frames on demanding games), you're getting boutique GPGPU pushes like PhysX that don't have a major (for now) impact on gameplay, and some increment improvements like DirectX 10 and 11 that have had minimal effect on visual quality (although local tesselation might improve fine detail, I don't expect games to make significant use of it yet, especially not until Windows XP is dead).
 
The following are a non-exhaustive list of informed generalizations about the platforms.

You will get:
Higher true resolutions (as opposed to rendering at a lower resolution and upscaling, if you have enough GPU power and the monitor to support it)
Higher texture resolution (if you have enough memory, which is pretty easy these days)
Faster loading times in properly optimized games.  
Player-created content in titles that support it (either officially or hacked-in)

You'll miss out on: 
Insert-and-play gaming (You'll have to deal with installations and sometimes troubleshooting much more often than with consoles - I know this for a serious fact)
A majority of local multiplayer (there is an assumption for many games of one PC to one person, although some titles, for example Trine, may give local multiplayer options)
A minimum guarantee of performance (console versions have an individual set of specifications to conform to, and may be optimized to the last bit for them, while PCs are a broad performance target)
 
Admittedly to me what makes it worth it is a combination of the tinkering aspect of hardware and software, the ability to use my computer for more than just games (although admittedly these applications don't have as steep requirements for performance), and the high visual detail attainable when you have the right equipment. Troubleshooting is much less frustrating if you research the issues and learn to resolve them yourself, although obviously not everybody is going to put the time in to do this. Hint: searching the Internet is an EXTREMELY helpful way to find solutions for errors, especially using portions of the exact wording of error messages. Watch out what you install in the background, too. A lot of popular security software is highly invasive and may negatively impact gaming.
 
Addendum: speaking of failures, a lot of PC hardware from decent vendors (ASUS, EVGA, BFG, etc.) has 3-year warranties on components for pretty much anything that isn't your fault. Obviously this is probably about as annoying as sending in a RROD XBOX 360 unless you have backup components, but I haven't had to use mine too often. Most recent case was a 4850 fan dying (I didn't feel like paying for a cooling kit and voiding the warranty at the same time). Sent it to ASUS, and their warranty depot being out of 4850s, I got the offer to receive a 4870 as a free replacement.

I'm a PC Gamer, but I haven't updated mine in a while. Last year, my computer was friggin' awesome. It could run Crysis (sure not at high, but w/e) and do everything beautifully.
 
But now, I can't even load the Sol System on Star Trek Online Beta. Grr..
 
BTW - If anyone wants a betakey, let me know, I have an extra. Just PM me. I'll post on my status if it's taken.

 Dont mean to stir up any controversy but I always thought of the PC as the xbox360 but so much more.....   

" @Demyx said:

" Sounds like a good idea. You could definitely build a powerful computer for less than a $1000 "

Definitely less than $1000. If you were really strapped for cash and were savvy enough, you could built an adequate PC for under $600. "  

" @Demyx said:

" Sounds like a good idea. You could definitely build a powerful computer for less than a $1000 "

Definitely less than $1000. If you were really strapped for cash and were savvy enough, you could built an adequate PC for under $600. "

@scubasteve2010
Oh yes, that issue presented a great build. I say go with windows 7 ultimate or professional ($50 more, will likely come in handy later).
From then on, all you need are those amazing steam sales! :-)

There is also something Ive always wondered. When you play a 360/PC game, what typically is the PC eye candy setting that would be most similar to how the  360 version looks?

I have a really good mid-range PC going right here that was about five hundred bucks.  That includes accessories, too.  No worries about the cost.

do it!  :D

I have a $600 rig and I can run most games on high-very high settings at 60 FPS.

Thanks for your responses. I have another question. When a game lists recommended system specs, what resolution/ graphic settings will those recommended specs let you play at?

I just finished build my gaming PC about a week ago. Total cost was about 940$ but I went a little stupid with my motherboard (P55 FTW)  so it's easily possible to make a fully capable PC for 600-700$

I hope someday ppl (including the giantbomb staff) will stop treating pc gaming as some sort of pariah to be ogled and pointed when they really know nothing about it (or at least what pc gaming is today). I play a lot of pc games (and 360, psp games), i use a 4 yr old machine with a 2nd hand graphics card (8800GTX) which i spent $200 AUD on and i play all current games on high settings. In Australia at least you could get customs machines from smaller sites (mwave.com) for less than the cost of a new console. 

I used to be WAY more into PC gaming than consoles. In the end i decided that 1) RTS games were getting repetitive and 2) i was sick of having to keep my computer up to date. I had neither the time nor the money (nor the knowledge for that matter) to do it successfully. If you can keep your rig updated at a level that your happy with then it might be worth having a look at.   

You can definitely buy a $700 PC with graphics as good as consoles, but you have to ask yourself if that's worth it compared to simply buying another console and having $400 to spare on games.  
 
I think there are 4 key features of PC gaming:  
 
- Graphics: If you have the hardware, you can pull off jaw-dropping stuff.  
- Community: Mods galore; games are made far more interesting with texture and gameplay mods.  
- Exclusives: Crysis, Dawn of War 2, Empire Total War, Torchlight, Plants vs. Zombies and a metric ton of indie games. The amount of good exclusives on PC would surprise people, and hidden gems like Dawn of Discovery always keep me smiling.   
- Low cost of games: Digital distribution makes buying games both easier and cheaper. Steam is notorious for its crazy sales and the cost of a good PC is much offset by the cheap cost of games. 
 
If you want to go off the deep end you have to do it right; it doesn't make much sense to spend $700 to buy a PC that is the same or only marginally stronger than a console. If you want the full experience, you need to put the time and money into the research and hardware. 

" @InfiniteStateMachine said:

 Dont mean to stir up any controversy but I always thought of the PC as the xbox360 but so much more.....   

No that was exactly what I was thinking. I could build a machine comparable to a 360/PS3 with added features such as htpc functionality.   
 @JJWeatherman said:

" @Demyx said:

" Sounds like a good idea. You could definitely build a powerful computer for less than a $1000 "

Definitely less than $1000. If you were really strapped for cash and were savvy enough, you could built an adequate PC for under $600. "  

There was a write up in this month's Maximum PC.  http://www.maximumpc.com/article/features/how_build_awesome_pc_647 
  

The Parts List	PART	PRICE	URL
CPU	AMD Athlon II X4 620	$99	amd.com
Motherboard	Gigabyte GA-MA74GM-S2	$57	gigabyte.com
Memory	Patriot 4GB DDR2/800	$85	patriotmem.com
Videocard	Sapphire Radeon HD 5770	$166	sapphiretech.com
Hard drive	Seagate 500GB Barracuda 7200.12	$55	seagate.com
Optical drive	Samsung SH-S223C	$26	samsungodd.com
Chassis	Rosewill R220	$19	rosewill.com
Power supply	Cooler Master RS-460	$35	coolermaster.com
Operating system	Windows 7 Home Premium OEM	$105	microsoft.com
TOTAL COST	$647

"

I took the plunge when I got some left over money from school. I spent quite a while learning about computers. It was either a new PC or an xbox. But I went for the PC since it would do more than just play games. So I got my friend to help me. We built it, and I've added to it ever since. I'm sure I haven't gone beyond $700. What really makes pc building expensive is the monitor IMO. If my monitor is still alive, I'll reuse it when I build my next PC in a couple of years.
 
Also:
 
I <3 Team Fortress!

" I took the plunge when I got some left over money from school. "

There is also something Ive always wondered. When you play a 360/PC game, what typically is the PC eye candy setting that would be most similar to how the  360 version looks?

If you already have an alright computer you can rig it for pc gaming for even less since you don't have to waste money on stuff like a glow-in-the-dark case that you will never look at.

your plan is good but i think you might end up kinda stuck and unable to upgrade in the future if you spend a bit more on the motherboard now it will be easier to just upgrade a couple of parts instead of having to start all over for example when i assembled my first PC i bought a 1000 watt power supply that was quite expensive but i doubt i will have to buy another anytime soon plus it also had a lifetime warranty so for at least 25 years I'm covered with a great power supply for my PC

" If you already have an alright computer you can rig it for pc gaming for even less since you don't have to waste money on stuff like a glow-in-the-dark case that you will never look at. "