well.. yeah, legos are really expensive.. but.. my 8 year old son has played with them every day for atleast the past 3 years and that is no exaggeration. He rebuilds, invents, creates, and plays with them in numerous ways. Oh yeah, and he spends pretty much every dollar he earns or gets on buying even more legos. It's a toy that doesn't require batteries, requires both sides of the brain to be used when playing with them and is extremely durable.
So it is worth every stinkin penny imho. Though I still can't bring myself to buy the sets that are $75 and up.
As for my nonos... Nintendo DS. I refuse to allow my son to be sucked into Nintendo DS world when we go out. He can learn to amuse himself through conversation, drawing and reading. It's a skill that will come in handy his entire life. We have a Wii at home anyway and that's enough.