I was thinking about writing a C-Blog on the place of music in games (and I still might), but I thought it would serve better as a forum discussion.

I'll start with the broadest of broad questions:
What place does music have in video games?

Games can have some incredible soundtracks, most of which go ignored by the general public. However, when a game like Grand Theft Auto has a ton of licensed music, it gets plenty of attention. Why do you think this is?

Then there is the issue of music's place within the actual game.
How much of an effect does the music of a game have on your experience with it?
Would Brutal Legend have been as enjoyable if it had been composed entirely of original instrumental tracks?
Personally, I know I can't enjoy playing 99% of games unless I have the music turned on; I generally refuse to even listen to anything other than the game's original soundtrack, unless it is particularly bad.

Finally, there are rhythm games. While very rarely containing original music, these games attract fans of music from across the gaming sphere.
What is your opinion on rhythm games? Is the genre being beaten like a dead horse, with the advent of games like Band Hero and DJ Hero, or is there still room for expansion?

Feel free to add your own questions and debate civilly.