Simulation or arcade?
If you want a racing sim, yeah, Forza Motorsport is top notch from what I've heard. If you're into arcade racing, pimping out Neons, Sentras & Civics, I suggest Need for Speed Underground (the first one, not NFS:U2, which IMO was pretty lame). If you're into arcade racing and want higher-performance vehicles, Project Gotham Racing 2 is a really fun game.
Then again, you could buy a PS2, get Gran Turismo 4, and just be happy