The most useful thing I can tell you about buying technology this December is that two of the three consoles are effectively unavailable and the third is the one I would recommend anyway.
Start there, because it is where most of the money is going. The Wii at $249 is sold out, will stay sold out, and is the machine most households will actually enjoy. The PlayStation 3 is sold out for different reasons, mostly that Sony could not make enough, and the units reaching shelves are being resold at prices that should embarrass everybody involved. Do not pay a scalper. There is nothing on that machine yet worth a premium over its already substantial asking price, and European buyers are waiting until March regardless.
The Xbox 360 is the one you can walk into a shop and buy, and it is also the one with a year of software behind it. If somebody in the house wants a games console this Christmas and is not specifically holding out for a Nintendo, this is the sensible purchase. Buy the version with the hard drive. The cheaper one exists to advertise a price and will annoy whoever owns it within a month.
For handhelds it is not close. The DS Lite at $129 is the best value in this entire guide. It is small, the battery lasts, and the library has range that nothing else in gaming currently matches. The PSP is a more impressive object with a better screen and fewer reasons to switch it on.
Music players are where I would be most careful, because there is a new entrant and it is not ready. The Zune matches the iPod on price and beats it on screen size and by including a radio, and its one genuinely novel feature has been restricted into near uselessness. Buy an iPod. If the person receiving it does not already own a large music library, the nano is the better gift than the full sized one, because nobody has ever complained that a music player was too light.
Televisions are the bargain of the season and I would take advantage of it. Prices have fallen further than the manufacturers intended and the sets are good. Buy the biggest panel that fits the room rather than the highest specification, because at normal viewing distances you will notice the size every day and the resolution almost never. Budget separately for sound, since every flat panel sold this year has speakers that are an afterthought.
Phones I would mostly avoid as gifts, because a phone is tied to a contract and choosing somebody else’s is a way of making a decision they have to live with for two years. If you must, the Razr is now free on most tariffs and looks better than anything else at that price, and you should be aware you are giving somebody a lovely object with irritating software.
The unglamorous recommendation, which nobody wants at Christmas, is storage. An external drive costs less than most of the things listed above and is the only item here that protects something irreplaceable. Every year I suggest this and every year it is the least popular idea in the guide, and every year somebody I know loses several thousand photographs.