The headset is used purely for in game chat, the sounds effects of the game itself still go through the TV.
That said, I’m sure there are headsets available which will do both.
I think Turtle headsets are the one to go for*.
My son plays a lot of PS3, I don’t
He uses a headset so that he can play with his friends, but also has the game turned up loud so he can hear what is happening in the game – surely this cant be right! is there any way to get game and friend audio to both use his headset and return my home to peace and quiet?