I can't tell you about GT 5 as I only have a 360 but my past fun with the GT series tells me it will be a good fun laugh if they haven't fiddled too much. Forza 3 is fun, although the tracks are a little dull for my liking and NFS: HP is a riot, but you do need to be connected to either consoles online service to make the most of it.
Anyway, if you want a serious, hardcore racing game where you can faff about with gear ratios, suspension settings and what not, plus achieve racing perfection, get Forza 3 or GT 5.[footnote]Note you don't have to faff around with those things, suspension, gear ratios etc etc, unless you are very obsessed with shaving time off of your laps and what not I personally never touched them in Forza 2 or 3.[/footnote] And if you want a fun arcade racer with some flash cars you can smash up, get Need For Speed: Hot Pursuit.
Or get any of the other games suggested here, including PGR as that's a serious arcady type racer. You have to be bang on with your racing line but you can still slide sideways a lot.
