After putting about 5 hours into it so far, PGR2 is probably one of the best games I've played for Xbox, bar none. And I tend to be an RPG fan. ;-) The visuals are stunning, the audio effects are fantastic (The music.. eh.. so/so), the gameplay.. superb.
The races are easy enough for a non-gamer to enjoy at the low levels, but as you move to the gold and platinum rankings, are extremly challenging to do well. The implementation of Live is also excellent.. single player rankings against the world are a fun way to just try and motivate yourself to do better. Easy access to multiplayer racing as well, though I haven't personally had time to investigate this feature.
If you have an Xbox, and like racing games (Possibly even if you don't), you've got to try this game.