Forza Motorsport is a simulation racing game. I much prefer it to Gran Turismo due to the availability of driver's aids (please excuse me if this has changed in more recent titles. I haven't played a Gran Turismo not on the PS2). It can be quite repetitive: there are always eight cars in a race, you will race the same tracks repeatedly, and, obviously, there is no nitrous, no hydraulics, and (thankfully) no cheesy story. The biggest variety will be in the kinds of cars you get to drive and it is impressive how distinctly they handle from one to the next. When you install aftermarket parts, you can access the option to fine tune them (but it seems I am only capable of making them worse).
As far as the actual playing goes, these two games are very much alike, though there are a few minor differences. One of the most notable is how much easier it is to damage your car's engine in the first Forza. Seriously, if you miss a shift and over-rev for a moment and your engine is going to have to be repaired. This can get a bit annoying, especially when you have a powerful car with an old transmission and "yer givin' 'er all she's got." My experience with over-revving actual engines is limited - I can't say whether this is an accurate simulation (cheers if it is). To mess up your engine in the same way in Forza 2, you will have to aggressively downshift at a high speed. But, in light of things, this isn't really a major difference.
A feature in Forza 2's favor is that you have the option to have a partial brake line (whereas in Forza it is either fully on or fully off). I actually find the partial line more helpful than the full line because it will only show up when I have to reduce my speed; when it is a full line I have to pay attention to when the color changes. This isn't a big deal but sometimes the colors run together. Along with this, Forza 2 allows you to see real-time information about your car as you're driving, such as tire pressure, horsepower being generated, pressure on each shock, G-force created, that kind of stuff. It doesn't revolutionize the experience, but it's kind of cool.
Both games share a majority of their race tracks with each having some exclusives (Forza with more, including point-to-point races). As well, both games share a majority of cars, with each having some unique selections (though the favor being with Forza 2 by a long shot). Forza 2 has more manufacturers with more models. The two games' career modes are also very similar; most of the events are exactly the same (like the Corvette Club Cup, Corvette vs. Viper, etc.). They both offer fun decal and vinyl customization features, which one can lose track of time fooling around with (though there is either something wrong with my copy of Forza or my XBOX 360 in trying to read it. There is a serious glitch with trying to apply vinyl).
I think I can easily say that the biggest difference between them is in how they handle simulated races (the very idea of which is weird to me. Why would you want the game to do the job for you?). The original gets a big thumbs up in this regard. It takes a little effort, but it will have you drive through a few tracks and will try to get a sense of how well you are able to handle different types of turns (and it apparently thinks I suck at hairpins). They call this your "drivatar." If, for whatever reason, you want your drivatar to do your racing for you, you can upload him or her at the cost of most of your winnings. I think this is kind of cool. Forza 2, however, simply has drivers you can hire. Not nearly as cool.
But Forza 2 is superior in other areas where it counts, particularly in car performance customization and car rankings. For many of the cars in Forza, no body modifications are allowed, whereas the same exact models do have available mods in Forza 2. As well, the number and specificity of upgrades are greater and add more depth to the game as a whole. What I mean by car rankings is that I've found that mismatches are much more common in the first game; it's a bit like Midnight Club in how it seems your ability to win depends as much on your upgrades as on your driving skill. Regrettably, both have cars ordered at the start of the race from fastest to slowest. Wouldn't it make more sense to give the slower cars a handicap? You also get no bonuses for finishing with a lower ranked car, which is disappointing.
As you would expect, Forza 2 has the advantage in graphics and presentation, but not by as wide a margin as I anticipated. I honestly don't feel like I'm changing between generations. Forza offers music while the other does not, though this doesn't make a difference to me since I just listen to my own stuff anyway.
When all is said, it's not easy to call one absolutely better than the other. Forza 2 just seems to be a next-gen port of the original with a few good additions but also some subtractions. And based on the similarity of games in this franchise and the price for which newer installments can be had, I don't recommend picking up either of these games. Actually, forget that. You can buy either of my copies here and here. I'll even sign them for you. [Editor's Note: Copy of Forza 2 has been sold.]
By the by, here is a trailer for Forza: Horizon DLC. Man, the last time a racing game trailer gave me goosebumps like this was NFS: Hot Pursuit 2.