360 is superb, I would highly recommend it.
I too had never owned an Xbox because I didn't like the huuuuuge controllers. However, the 360 has smaller more comfortable controllers (and wireless) and is a much better ride
Xbox live is about a 5er a month or a bit cheaper per yearly subscription pro rata, but you can by vouchers much cheaper on offer from game stores and type in the promotion code
Xbox live is great, just turn on the game, choose the online option and there is usually alobby waiting just about to start.
Also my 360 is connected up to my home network so all my mp3s can be played through my 360 from my pc and through my front room speakers
Wonderful