I hate gifts that require people to spend more money to enjoy them! Game systems can be the worst offenders. At least the Wii came with one game in the box ... but even that's not as much fun until you buy another 'wii-mote' and nunchuck.

It sounds to me, Liz, like they told you what they wanted and you decided for them that it wasn't really what they wanted. That's fine, I guess, but you shouldn't be surprised that they continue to strive to get something they want.

You might ask why they need another game system, but they may ask why you need another decorative item in the house.

It is their money. It was gifted to them by their grandparents. Their grandparents did not give you the money and ask you to do what you think is best with it.

Let the kids make their decision with their money. It is the morally right thing to do.

I'm sure you have different priorities for your money than your neighbors, friends, co-workers, and parents. The same is true with your kids. Their priorities differ from yours but there is no reason to believe that they are going to spend their money on something they do not think will make them happiest with it.

Get back in the kitchen.

I say let them make the mistake since it's better for them to learn the lesson now when it won't have terrible consequences.

My 12yr old asked for playstation2 for Christmas, along with many other items. We already have Wii and DS handhelds and many games for them. I told him no to another gaming system-how much time do they really have to play all these different systems? How many tv's do you have to hook up to?
He and his 15 yr old brother also received gift money, but we have strict rule about how much goes towards savings. So, he won't be buying another system on his own.
Even though it may be hard, parents need to be the adults they are and set limits. Three months from now, they will be happy you said no, as there will probably be something else they want.

How much do they want for the Wii?

I am a huge proponent for natural and logical consequences. Learning how to save/spend money is an important life skill that needs to start at a young age. My two cents: encourage your kids to wait a week or so before making the purchase. Perhaps they can work out a list of pros and cons. Give them a concrete example as to how you've done the same thing when making a big purchase - you did a lot of research on the car you bought, for example. If in a week they still want to buy the game system, then let them. If they have buyer's remorse in a week or a month, that is a natural and logical consequence and an important lesson.

As parents, we want so badly to protect our kids from making decisions that could lead to uncomfortable consequences. But sometimes making these not-so-good decisions, as long as they aren't ones that compromise their health and saftey, provide the best lessons our kids can learn.

I'd let them buy it. BUT, I'd make them wait a month before they could get it. They might change their minds.