[Davies]

No game categories are mutually exclusive, and there's a lot of grey areas between simulation and strategy, and between strategy and RPG, and RPG and adventure, and so on.

These are the categories I use to sort out my games, with rough working definitions:

(Arcade) Action - Emphasis is on movement and/or shooting. A straight test of reflexes, with no real brain work required beyond remembering what moves to make when. Examples: Space Invaders, Blockout, most platform games, simple fighting and racing games.

Action Strategy - A mixture of movement/shooting with a strong element of puzzle solving or similar brain work. Examples: Tomb Raider, The Chaos Engine, D-Generation.

Board and Card Games - Simulated play with board games or playing cards, e.g. chess, poker, Monopoly. These could come under strategy games or simulations, but they feel so different in gameplay that I prefer to keep them separate.

Puzzle Games - Pure puzzle solving with no important storyline and no arcade-type skills required (though there may be time limits). Examples: Sokoban, Tetris, jigsaws, crosswords.

Educational Games - Games of any type which are intended to teach as well as entertain. Usually aimed at children.

Adventure - The player controls a character through a clearly defined storyline with few or no random elements. The player character usually acquires possessions and may acquire new skills or attributes, but these are directly related to points in the storyline where they are needed. The player may change character during the game, but controls only one character at a time.

Role-Playing - Similar to adventure, but with stronger emphasis on random elements. The player character acquires possessions and improves his skills or attributes, but in order to improve his overall odds of survival rather than because they are needed at specific moments. The player typically controls a party of several characters at the same time.

Simulation - An attempt to model a realistic (or fantasy-realistic) situation. The amount of detail in the program is irrelevant, as long as an attempt is made to incorporate realistic "rules".
Includes (but is not limited to) the following sub-categories:
Sports Simulation - Model of any real-world sport. Also includes fantasy sports, e.g. Brutal Football, Caveman Ugh-Lympics.
Vehicle Simulation - Model of driving, flying, sailing, etc. any real-world or fantasy vehicle. I count racing games under this heading, though they could just as easily be called sports simulations.
Life Simulation - Model of caring for and perhaps breeding or training living things. Examples: Creatures, Dogz, Tamagotchi, The Sims.

Strategy - A game based on complex brain work rather than reflexes, in which you usually compete directly against another human player or human-simulation AI opponent.
The most common sub-category is:
Wargames - Recreations of real wars or battles, or pure "what-if" or fantasy battles. Gameplay typically based around manoeuvring troops, and often including some resource management.
There's no reason why strategy games have to be limited to war scenarios, but "head-to-head competition" implies that there's going to be some sort of battling for limited resources, even if that means just occupying the most space.

These next three sub-categories are squarely in the grey area between simulation and strategy. For each individual game, you could argue which side of the borderline it's on.

Business and Resource Management - Model of running a business or otherwise managing limited resources to achieve a goal. Examples: the various Tycoon games, trading games, games where you build up and run a small colony (going back to the very old days of Hammurabi).

God Games - Similar to resource management, but on a larger scale and with greater powers to make drastic changes in the game world. Examples: Populous, Black and White, Civilisation, Sim City.

Elite-Type Games - Games that combine vehicle simulation with trading and resource management, usually incorporating action elements (combat), and possibly including an overarching storyline. Examples: Elite, Starglider, Federation of Free Traders.