0) As much as I'd like to get an entry level job and work my way up (which I am very confident I could do), its just not in the cards.
1) Take night classes and get my CS Master's.
2) Work my ass off on my own game (either alone or with some people) and prove I can make a commercially viable product on my own and use that as leverage to skip the bottom few rungs of the ladder.
3) Investigate some kind of lateral movement towards the game industry using the management skills and experience I have accumulated over the past 10+ years.
4) Explore the possibility of taking an entry level job and finding some other way to supplement my income to make up the difference in pay.

It's worth noting that while I would like to eventually get into the game design end of things I consider myself a more than competent programmer as well with a few hobby projects to my credit. Nothing to write home about but still, its something.

So I guess I'd just like to know if there is anyone with some advice out there...

0) Don't do that. You have 12 years of work experience behind you. You are not entry level.

1) That may be an option. Get the education if you want it, don't get it because you feel it will get you a job.

2) That's something you would do if you were a beginner or entry level.

3) Brilliant idea.

4) You are not entry level.

You have a CS degree, meaning you can speak programmer. You have management experience. That looks like a job.

You have a CS degree and programming experience. That looks like another job.

The first one could be a direct lateral move into a middle-management position.

The second looks like a move to a programmer in your current field, then another move into the industry.

I'm wondering if a good strategy for breaking in might be, if it's practical location-wise, to attend any and all game-develoment related meetups. IGDA has information on these. Making friends with people in the industry might be a great way to get your foot in the door. I'm assuming you don't live in a very large metro area based on your salary, so it may be difficult to find these sorts of events, though.

I've read from others that in a field like CS a 14 yr old degree can be looked upon negatively compared to one received recently based on the speed with which certain things can change in a game programming environment. Now is there any truth to this or is that just some other random thing that people throw out there who failed for other reasons but want to blame it on something?

In your earlier description, you said that you'd gone almost straight to management.

Are you looking for a managerial role in a game development community, or line development?

If the latter, anyone looking for a programming position who hasn't been doing professional level programming in over a decade is going to be at a disadvantage. You would need to demonstrate that your technical skills were sharp enough for the position.

75k$ is pretty steep, but I'll assume you are in the US, so its not impossible to achieve (I've seen it done in lateral moves more than once).

That said, it appears to me you're switching from an uncertain job, to another uncertain job.

I know a lot of folks here will beg to differ, but my experience in Canada is that people get fired like flies.

With no prior knowledge of the industry you're currently in, I'll only say that you need to be careful.

My experience is that middle management is not only affected by these cuts, but actually gets a greater proportion of the heat.

Over the last 4 years alone, I've seen more than 5 producers/assistant-producers fired yearly across all 3 studios I've been at.

This may not be a representative sample (in fact, I sure hope not) but this is the kind of thing you should research for yourself and make sure you understand and accept the risks.

Being a father myself, and the primary income for my family, I continually have to gauge this type of risk and keep savings just in case.

Hey Plethora! I was in a quite similar position a while back and I somehow managed to make the change happen. I myself did it by sacrificing around 40% of my income and starting at a half-entry position, but then again, I could afford it, having no children and I really wanted to be in development, not in management.

I can assure you though, that there are options that don't necessary need you to sacrifice your income. Experience in management, especially project management, can really come in handy. For example, in my company there's something called PMO - Project Management Office. It's actually a one-man-department and it's quite a handful too, coordinating resources assigned to various projects in the company, but a while ago this position was taken by someone just like you: a guy in mid-30-s, successful corporate manager with no prior experience in the industry. I know for a fact that he rather got a raise than a paycut.

One advice I would give you is - don't look at the gamedev companies career pages. They are almost never up to date. Also, if they get an impressive resume showing experience in management, understanding of games and CS degree, they sometimes might just decide that they could use someone like that even if they weren't looking for anyone with this skillset at the moment. Some networking wouldn't hurt as well. Go big. If the company isn't a giant like Ubisoft or EA, you might wanna go an extra mile to get to know someone that knows the CEO and just pass your application avoiding the resume-eating-swamps of HR department.

Good luck!

One advice I would give you is - don't look at the gamedev companies career pages.

+1 to that!

I've led a number of relations into various offices just because of stuff I've heard people might need. H.R.s are good at correlating needs with opportunities, so contacting them in one way or another is definitely something you'd want to do. Besides, if you can spot a compay you want to work at, and that timing is not an issue (you already have a job anyway) they will probably understand how serious this is for you.