Dreamcast has tons of good racing games ... 3 of the most recent games are:
Sega GT (Sega's Gran Turismo copy) - Very good, but very hard, I haven't played it much, but I'm told its similar to Gran Turismo, except it doesnt have quite as many cars, but graphically of course, it blows away the PSX version
Tokyo Xtreme Racing 2 - You buy/modify/race street cars (like Mitsubishi Eclipses, Honda Accords, Honda Civics etc) around an actual Tokyo highway ... Challenge cars by flashing your lights at them ... kindof like a fighting game, except with cars, and you reduce their "energy" by being ahead of them, very cool game, I play it all the time, I love it ... The car models are near perfect (esp. for the Eclipse), but none of the cars are licensed, so you kindof have to guess at what car it is by the looks ... (The Eclipse is listed as like a D32AGT or something)
Ferrari F355 Racing - Like the game says, you only can race with Ferrari F355s, but the physics engine for it is supposed to be near perfect ... the game is very hard, but alot of fun (There's nothing but a 1st person perspective to play it though)
Sega will also be coming out with an enhanced version of Daytona for the Dreamcast ... Check out
http://dc.ign.com for details ... Hope this helps you. There's also an article at the same link thats about all the great racing games for Dreamcast ... Just look for it.