What can video games be used for

Video games can be very good for developing hand/eye co-ordination and for encouraging alternative thought processes.

Different genres of games have different benefits.
Educational:
Educational video games are doubtlessly the most useful ones. Most of them are targeted at children of young ages and are an effective way to teach different things.
Action Games:
Although action games are highly controversial, they still have benefits such as building coordination and improving senses. They also help to improve a person's concentration.
Puzzle Games:
Puzzle games help improve problem solving skills and alternative thought processes. Portal is a very good example of it.
Strategy Games:
Strategy games help increase a person's planning and thinking powers. Some strategy games such as Age of Empires feature historical campaigns which also contribute to a person's historical knowledge.
Simulation Games:
Simulation or "Sim" games are very entertaining and useful. For example, a Flight Simulator will help you understand how airplane controls work, a social sim will help you to build social and communication skills.
Music Games:
Music games also help you learn coordination and sequencing; they are very challenging.
Sports Games:
Sports game need coordination and tackling skills and can be beneficial in developing these skills.