I really like Outrun 2006. The graphics look best on the PC version, though the xbox version is close behind. It also works great with a driving wheel.
If modern is what you are looking for I think investing in an original XBOX would be a very good idea. There are so many racing games for that system (and many of them still look good). For example, the whole Need For Speed series, Rallisport Challenge, Forza, XGRA, Spy Hunter, some motorcycle game I can't remember right now (but looks great), the EA NASCAR games, etc. There is plenty to choose for.