It's huge. PS5 plays ps4 games too. Aside from trading with friends/coworkers instead of dropping $60, you can often get them for under $10 at thrift stores or FB Marketplace. Even new copies of games can get low on price when they get older. Digital games that are 6 years old are often still $60. The digital play is to wait until a game goes on sale. But sometimes you just feel like playing a game and you never know when/if it will go on sale. And, when it does, it's still not as cheap as a used physical copy is year round.

And you can sell physical games. I started buying/trading/selling games and consoles as a hobby but it's actually paying for my subscriptions and games.

I use both Game Pass and PS Plus Premium. They're both great. Game Pass is $180 a year at $15 per month. For PS Plus, you want to buy the year in advance. Otherwise you pay more. I recommend PS Plus Extra at $100 for the year. It's cheaper during the holidays. The Premium package adds another 300ish games for another $20 for the year. However, most of these games are from older PS generations. It's a great deal for me but it might not be for everyone and you can always upgrade. That's why I recommend the PS Plus Extra package.

Anyway, I'm sure he'll be happy no matter what you get for him so don't stress. If you need any more advice though, just let me know.