The package allows PlayStation Network subscribers to claim two free PlayStation 3 and two free PlayStation Portable titles from a selection of five.
The "Welcome Back" package is part of Sony's goodwill gesture after the recent PlayStation Network outage and data breach.
Sony's posted a fairly comprehensive FAQ about the "Welcome Back" package on its European and North American blogs. You're best investigating at the relevant blog for your region for full details on the offer.
As for recommendations, you can't really go wrong with any of the titles Sony's included in its "Welcome Back" package. Our top-picks would be Wipeout HD and inFamous on PS3. Meanwhile, LittleBigPlanet and Pursuit Force are probably the best choices on PSP.
You choice is going to rely heavily on what you already own though. If, like us, you own all of the available content, well, better luck next time, eh?
Let us know what you've chosen in the comments.