Dance Central 2 is way better. I guess it depends on your tastes but the songs on JD3 are so lame. They are all old or totally random. And the psychedelic dance style is annoying to look at. The groups dances are kinda fun but really I couldn't wait to take the disc out. The song selection of Dance Central 2 is top notch. Really no lame songs on the list. And the response to dancing is much better. For me, hands down, DC2 is the game to pick.
Dance Central has more "adult" dances and song choices, meaning they're more choreographed and focused on performing them correctly for a higher score. All moves are camera-facing or slightly side-facing. There is the break-it-down mode where you can get a feel for the moves of the dance before you do it, making performing, and learning, the songs easier. The side-scrolling flashcards are not intrusive, but on harder dances may not show you the whole range of movements associated with the card. Dancing with a partner is basically them dancing the same dance as you, next to you, unless you're doing Dance Battle, then you compete. Dance Central is harder to do well, however, it feels like, if you do it enough, you can improve your dancing ability.
Just Dance has, I think a better song selection that appeals to more people. The movements seem less choreographed, but certainly more involved (twisting, turning, full circles, etc) as a whole, which can make following what moves to do next somewhat tricky. The moves are more spontaneous than choreographed, less structured... I'd say the type of moves you'd see done by a good, though not trained, dancer at a club. The party mode is fun, though potentially confusing if your partners can't dance... Since dancers must coordinate opposing moves together, the results can be fantastic if done well or disasterous if not. The graphics are much simpler, basic. The mirrored dancers can be distracting, but as they're modeled on real dancers, feel more lifelike in their movements than Dance Central. Their "next move" system takes getting used to... It features a scrolling dancer at the bottom of the screen, not unlike karaoke prompts, only with an animation. It shows a more complete move, though the timing of it rarely coordinates with the mirrored dancer. It lacks any sort of learning mode where you can learn the routine of the dance before performing it which makes learning the dance somewhat confusing. That said, there is a much lower emphasis on accuracy then Dance Central... General movement or flailing in the direction of where you should be is enough to get a satisfactory score. I find their menu system, and their rating system for song difficulty, to be very confusing. I don't feel that playing this would make anybody a better dancer since the moves are, while more complicated, less cohesive and choreographed than Dance Central. It feels more like a satisfactory dancer at a club showing you how to jump about as oppsed to an instructor telling you how to dance well.
So, in short, if you're looking for a fun dancing party game, then Just Dance 3 is it. If you're looking for a fun dancing game that focuses on choreography and improving dance skill overall, Dance Central is it. I think Just Dance 3 is cheaper than Dance Central, however, I think Dance Central has more frequent updates/developer support and additional fun DLC with newer music and artists, while Just Dance has older songs added less regularly for a higher price overall (they don't bundle or go on sale as frequently as Dance Central's does). Also, for $5, you can import all of Dance Central 1's soundtrack, along with DLC, if you have the Dance Central disk (borrow it from a friend, Redbox it, rent it) giving you a dancing library that's about 2-3 times the size of Just Dance.
In the end, it's personal taste and what you want out of the game. I much, much, much prefer DC2.
I understand that to import Dance Central 1 into Dance Central 2, you need an unused code that comes with DC 1, as well as the code that comes with DC 2. Is this incorrect? That'd be great if I don't have to buy a copy of DC 1 for the import.