Skygunner is the kind of 3D shmup that was plucked from my wildest fantasies. It's set in a steampunk universe where crazy, anime-inspired pilots battle giant robots and enormous zepplins above quaint European towns. All it's missing is a giant squid. If you like Last Exile, you'll love Skygunner.
The control scheme is also very unique. Skygunner employs a kind of Z-Lock targetting system that orients your plane around your target. Imagine Zelda with machine guns... in the sky. To top this off, you are also trying to rack up combos and compete with your fellow pilots (controlled by a rather competent and competitive AI) who you can unlock and play as (along with a few other pilots).
A thoroughly charming art style complements the frenetic gameplay and leaves you with a smile on your face after every mission briefing and cutscene. There is a little comic on Atlus' website that introduces most of the characters and shows off the setting for the game.
And the first level :
The game may be a bit hard to find, but a quick check on Amazon's page shows it available for anywhere between $13 for a used copy all the way up to $100 for a new one.
Oh, I forgot to mention that the enemies in this game are the cutest enemies EVER!