It's hard to definitively judge the Sony Ericsson Xperia Play because so much of its appeal lies in what games will be available for it – currently the choice is a bit limited but in a couple of months there could be loads of great titles. What we can say though is that there are definite problems with it. Most notably the build quality doesn't live up to premium smartphones and its processor, while fast enough now, is already behind the times. The app purchasing experience is also horrendously disjointed.
That said, the game controls themselves are a huge success and even with the modest selection of games currently available they make a huge difference to the enjoyment of gaming on the move. So if that's your priority then it's worth keeping an eye on what games become available over the next few weeks then maybe take the plunge. If, however, you value the general smartphone experience first and the gaming second then you're better off with something like the HTC Desire S or Sony Ericsson Arc, or even one of the dual-core superphones such as the LG Optimus 2x.