No idea how I missed this post. :-/
I'm pretty much the same way.
Although I do enjoy horizontal shooters if they are done just right (Cotton 2 and Boomerang or Gradius 5), my true love lies with vertical ones, from Xevious to Bastugun and Dragon Blaze to Ibara.

After several years of holding off the inevitable, I finally caved in and bought a Pal 360.

Got a very good deal since the store was celebrating their anniversary and were giving 15% discount on everything but game systems, on which you only got 10%.
But for some reason they did give me 15% off.

So I ended up getting the system for €212,5 instead of €250, along with two games that don't actually interest me at all (Crisis 2 and Forza3) and 2 controllers.
But what I did get is the newly released Pal version of Dodonppachi Resurrection.
I was blown away by just how many games types you get in just one release.
There's the optional 1.51 version available on XBLA as well as the Black Label version.
But give you several remixed version of the game which play a lot differently. On top of this, when you start a game mode, you always get to chose between A, B and C mode as well, which again are very different ways to play the game.
You're bound to find a mode that's just right for you.
Also already had the Japanese region-free version of Mushihimesama Futari, again with Black Label and everything, as well as the Pal version of Deathsmiles, which is a horizontal one. Oh and Guwange from XBLA as well.
Just ordered a Sanwa arcade stick since the D-pad isn't the best to be honest. It's functional, but just isn't the same.
Also ordered Japanese region free copies of Muchi Muchi Pork & Pink Sweets and ESPGaluda II.

Can't wait for those to arrive.
So yeah, it might sound very strange to most people, but I basically bought a 360 to play 2D shooters on.

Everything else is a bonus at this point as I don't really get turned on by 99% of it's catalogue.
Loving the look of some of these XBLA games I have to say.
Shadow Complex is lots of fun in a Super Metroid kinda way and Super Meat Boy is just pure 8-bit platforming heaven.
Oh and Rising Sun Games has just announced that they will be Bringing Akai Katana to Europe early next year as well!
This is looking to be one of the horizontal shooters that's right up my alley with how the bullet canceling and attraction and repulsion systems seem to work.
Can't wait!