Back at 1UP, and on EGM our in-house style sheet dictated that the correct spelling is "videogames" - one word. As far as I'm aware, it was a long-term legacy thing, and it was part of the style guide that I inherited when I took over EGM back in 1998. Personally, I've always liked the idea of it being a single word, and this is something echoed in comments from Bill Kunkel (one of the first games journalists) at a recent CGE panel. As reported by Chris Kohler from Game Life,
"It doesn't make sense grammatically, but that's how the industry spelled it and I always felt it reflected the unique nature of the medium. We spelled it that way in '78 and I never stopped. What I did not realize was that, over the years, a schism developed over the spelling. I didn't realize how deeply people felt about it until I suggested that we would adopt that one-word spelling."
When we launched What They Play, we adopted the same spelling and drew some commentary for including the word "videogame" in our tagline. After some chin-scratching and pondering, we've now decided to switch to two words. Yeah, yeah, big deal, I know. Who really cares? The logic, which I thought was kinda interesting though, was that Googling "videogames" returns 71.5 million results, while Googling "video games" returns 821 million. These days, when launching a new Website, you can't argue with numbers like that.