My son has been having a blast playing with Creature Creator. With this game he is able to make neat animals and customize them with a variety of features. Hie creativity can be seen here.
Spore will take these creatures and everyone else's and keep them in an online environment where they can interact and evolve! It is not out yet and he is anxiously awaiting (he has already reserved and paid for his copy). I found this cool gadget here: