Option 1: Improve PC. Why? Becuase you don't got to pay for games saving you 60 bucks per game you play.
Option 2: Get a PS2 and MOD it. Better yet get an xBox, those bad boys are easily moddable to sustain huge harddrives (160gb +) which hold full games, movies, and you even load a mini OS onto the drive. If you got the money to do that, it becomes like a portable entertainment machine. Network it with you're computer and then you'll be set for life

The MOD isn't that expensive either. Around 100 US plus cost of harddrive (depends on how large).