If it's a multiplayer game, chances are you'll find at least one person willing to play or at least try out your favorite game. We just started doing a tournament at each party. Which game the tournament will be in is decided the previous party. We are still in the process of getting some sponsors, so our prize pickings are a little slim. Usually this prize consists of a crappy game, some poorly designed hardware, or worst of all, a hardware modification gone bad.
Prizes are more a badge of honor than any real gain.
We aim to get our members into the tournament scene, not put the focus on huge spectacular prizes. We occasionally organize trips to these parties if interest among members is high enough. Doing this gives us new ideas to try out, and gives us an opportunity to meet with new people. For example, if someone wants to create a Counterstrike map, that person can bounce ideas off other members, enlist help in creating it, and then test out the map at the next LAN party. Use of content witout the express written permission of the owner is strictly prohibited.