The PS2, by a fair clip. PS2 will have better lighting effects, more polygons, faster processor etc. etc. The only thing it DOESN'T have is built-in anti-aliasing, which is a technique that blends the image on-screen so the lines don't look so pixelated. So, first-generation Japanese PS2 games have been hammered because quite simply they don't look very clean.
However, some enterprising programmers have found ways to clean up those problems, so the US versions and 2nd-generation games will look substantially better.
Also, the PS2 will play all your PS1 games, and can also play DVDs. Do I love my DC? You betcha. But it's the way of things with technology.
Now, if you ask me about the Xbox...I'm drooling
But I haven't heard ANYTHING on whether Lucasarts is doing any Xbox development.