I agree with DFTGames in the sense that you shouldnt incorporate unless you have to. There are pros and cons of partnership, sole trader, ltd company.. but depending on your own circumstances… so you need to look at yours and decide.
Alot of the advice offered so far is typical of a "ltd or not" discussion thread.
We all know Ltd is more hassle and costly to manage…. so having incoming revenue helps alot! If client work is not something you guys plan on doing as it eats into the development time of your own IP, then you probably wont have any income until the game is released and it makes money (hopefully). You may look at a period of client work then… when you have a published title under your belt.
Reading your original messages, you mentioned you need to incorporate to enter Game Space…. and to get a Company App Store account
For Game Space, you could go the "have released a game" option to apply for space… but from what I gather, you want to apply now, before you have released your first game… so that pushes you toward the Ltd route.
You also mentioned the App Store issues with company names as sole trader, you are correct, this is not possible. This is "informed" advice…. as I have just been through this very recently myself.
So, bottom line, whether Ltd is more expensive or not, whether you have revenue or not, if you dont want to use an individual name as publisher on the App Store and you want to apply for Game Space before you release your fist title, seems to me the decision is made for you… .
I hope this helps…