We discussed about this also. Our boy is turning to 3 this week. For the 1st 2 yrs, we believe that he didn't know anything, so we just "celebrate" with close family members by eating outside. Seems like it's our celebration rather than his!
Since he is now 3 and he is the 1st child of his generation in both our families, so many people love him and would like to celebrate his birthday with him. We also think that he would enjoy receiving all the presents, and having more people to celebrate with him. I just hope both children and adults will enjoy the day!
I don't know whether I'll continue to organize big parties every year, but I also worry that he will not treasure these occassions if they come too frequently.