yea the first game (even in the old days) costed $400. and it was a gigantic system. and all u did was knock this ball back and forth (but not pong) here is more info. [url]http://www.bnl.gov/bnlweb/history/higinbotham.asp[/url]
My understanding was that pong was the first game. it was on an arcade machine and put in a pub over the road from the Atari headquarters. people couldnt figure out how to play it, then someone did, by morning there was a line of about 400 people lined up to play it. All this information comes from the gamemaker book btw, so I think its fairly reliable.
Pong was first shown on publics places. It was a huge machine where you put a quarter to play. Eventually the machine broke because the quarters were damaging the system.