super puzzle fighter 2: turbo. best, hands down. even tho it's only 1 vs. 1, its one of the few videogames i've found people enjoy watching while they're waiting for a turn to play. it's graphics, sound and tetris-esque premise are cute enough while its gameplay is competitive enough to draw in just about everyone, even non-gamers.
rez was always a favorite (especially once everyone was nicely drunk / high) because of the music + visuals. the problem with it was that people would invariably end up dancing in my living room to it's music and crowd-out the player's view of the telly. (this may or may not be considered a problem for you.) that happened with wipeout games, too.
marvel vs. capcom 2 was pretty epic with a gang of folks, too. (any 2D fighter with 2 vs. 2 / 3 vs. 3 action is pretty fun, tho.) its wise to avoid serving tequila at parties where fighters will be played unless you want someone to break your coffee table.
the worst party game i ever tried was attempting to show my mates how "awesome" shenmue was. that went over like a loaded diaper.
(can you tell the last console i owned was a dreamcast?)