Drumroll please... my top game of 2006 was:
#1. Dead Rising
One of the things I value most in a game is a sense of "place", of really being in the world of the game. Some of my favorites through the years, Star Control 2, Ultima 7, and Grand Theft Auto: San Andreas really excelled at this, and now they have company in the form of the fantastically executed Dead Rising. One of the things we tried to do on System Shock and Ultima Underworld was try to really create these spaces and populate them as completely as possible -- ideally anything you could have done in the "real" Citadel Station you'd be able to do in the game. Dead Rising follows a similar aesthetic, and the Willamette Mall is as fully realized a place as any game I've played in the past few years.
Not to be too pointy-headed about it... chopping up zombies with a chainsaw or putting traffic cones on their head has inherent value. The replay-oriented game mechanics of Dead Rising have fantastic synergy with the tense time limit, sense of isolation, resource constraints, and the way they structured the Achievements. On top of all that, the game really uses next-gen power to do something new, in the vast hordes of zombies on screen. Sure, the cutscenes aren't up to par with the rest of the game visually (though they make up for it in over-the-top-ness), the story is a bit goofy, and it could have really used a "suspend" save game slot. But those are minor nit-picks on what is to me, clearly the best game of the year despite some amazing competition.
Here's some slight consolation for #2 game, Saints Row, in the form of a musical theater piece! Admittedly, its one celebrating the bugs but you're doing something right if even your bugs can inspire someone... :)