When I see a beautiful game such as this, I get discouraged...

Don't be discouraged. Start small, maybe clone some games with your own spin on them from the 1980s or 1990s, and experiment.

Make several projects, demos, and have fun with them. Get some example files and start tinkering.

I always make very rough games starting out, with one color boxes and shapes until I get the gameplay and inputs where I want them. Then I decide on what kind of visuals I want to apply to it, and "onion layer" up until I get it to where I think it is good enough for release (not always finished and where I want the projects, but people can't check them out, and learn from your projects until to release them into the wild.). You can't always just keep sitting on your projects.

It is good to have a few projects that you ae working on, it helps you not to get burned out on one, and if you get stuck creatively or technically on one project, you can jump over to another. Often times, you come up with a solution to any problems while working on something else.

It is also good to describe your problem out load, to vocalize it, it often helps too. Please login to see this link.

Put on some headphones and some music in a playlist, and start checking things out

Also, it's important to remember: Gameplay over graphics. The graphics probably shouldn't be awful, but not all games need to look as amazing as the one in that video. As a matter of fact, sometimes, a more minimalist or cartoony style can benefit a game instead of hinder it.

This may be a good time to mention Platformer a Game, for example: Please login to see this link.

(If you don't want to play it, then quite frankly, while the videos don't fully get the experience of playing the game across, they are probably enough for my point)

It's not very well-known, and the graphics definitely aren't impressive (though admittedly the animations are for the most part rather impressive, if for no other reason than how smooth they are), but it was made with CF2.5, and aside from some bugs that can make it a bit hard to progress if you don't know how to get past them, it's actually a game I'd almost consider a hidden gem... though definitely a very, very rough gem if it is to be considered one in its current state.

It also proves that sometimes, your game doesn't need to be too unique, it doesn't need to look good, though it should probably look consistent (e.g. don't use a super-realistic graphic for an enemy with a lot of animation frames, only to have it launch a projectile that looks like it was drawn in MS-Paint, instead either make both of them super-realistic or both of them look like something drawn in MS-Paint), it doesn't need to be very long, it can be rough around the edges and doesn't have to be particularly polished as a result... really, a game just needs to be fun, and for a first game, you don't need to worry too much about that, either. It may take a few games for you to get down just what it is that makes a game fun, and that's fine, I know it took me a while to truly understand what made a game fun (look at my older games to see what I mean, and even then I still wouldn't say I'm that great at it now, though I'm definitely better at it than when I made those older games).

When I see a game I like that does something impressive, I like to think about just what it is that is so cool about it, and what can I learn from it to make my games better!

That way looking at any game is an inspiration and an opportunity to think about how to make my work better!

Keep in mind that game is made by a team of people.

Definitely do not be discouraged by those.
You should absorb everything as a learning experience.

Try to understand what makes the game good.
Ask yourself what kind of feeling does this game provides.

Whenever an idea pops in my head I take notes, so I won't forget.
Often I try to implement them in my projects and see if they work.
It definitely helps out a lot in creating something unique and exciting.

See, when I see games that are really impressive and I start thinking like that, I think to myself- I shouldn't be discouraged by this- but rather, I should use it as motivation- strive to create a great game like the intimidating masterpiece I see before me. So next time you see an amazing game, don't let it discourage you- let it inspire you.

Don't be discouraged, that was probably made by like a hundred guys and professional artists.

But I know what you mean- the first time I ever saw / heard Dream Theater I was very tempted to stop playing bass and drums because WHAT IS THE FRIGGIN' POINT??? Eventually I just said screw it, I'll never be able to play like that so just focus and do your best. You might not be able to copy others' abilities, so just try to make your own original stuff. So while Dream Theater might be able to play a million notes a second, They will never have a song called "Space Farts", for better or worse hahaha.

For example, I think an original singer is much better than a great vocalist who sounds like 10 other great vocalists.
Peter Garrett of Midnight Oil fame is my favorite singer, but tons of singers out there are / were technically "better".

Keep this crap in mind!

It is a bad idea to even compare yourself (a beginner) to a team (maybe 5 to 10 people with years of experience). Realize that Pulstar was made by people who were each skilled in specific fields (art, code, sound, etc) and they weren't making their first game. Also, consider that Pulstar is HEAVILY influenced by R-type, so it isn't exactly breaking a ton of new ground. Like many have said, make what you want to. Make it for yourself, not for financial success, and you will find out if you really enjoy making games. If you do and it is what you want to do as a career, then you probably need to worry how other games compare to yours, because that is just how you compete in the business world. But as a beginner, you really should not be worrying about "professional" games and how your games stand up to them.

& remember....

the Pulstar artist couldn't program the game or make the music,
the Pulstar programmer couldn't draw the sprites and animation or do the music,
the Pulstar musician couldn't draw the sprites and animation or program the game

they are each masters of there own field.
being a one man band is hard, as you hav to split your time honing one skill into honing several.
as long as your bettering your own work & improving bit by bit your on the right track

& hey...even the japanese themselves aren't making games as cool as that anymore XD

That's the spirit! the higher the mountain, the more satisfying it'll be when u finally stick your flag on the top!

Five Nights at Freddy's should be an absolute inspiration... Just goes to show what one guy can do! Even teams make games that hardly make any sales or even recognised. It's all about hard work, chance, commitment, angle, direction and polish.