Justin Marc Smith has a great little article over at Biblical Interpretation on Genre Matters: What Kind of Bioi are the Canonical Gospels?
Why does any of this matter? If we understand the canonical gospels to be of a certain type of literature, then new possibilities are opened for interpretation. Often, the writers of Contemporary biographies had a personal relationship with their subject. Isocrates was friendly (if not friends) with Evagoras. Xenophon had a relationship with Agesilaus as he served under him in the military. Tacitus had a personal relationship with this father-in-law Agricola. These are just a few examples of the sorts of personal relationships that might exist between an author and subject. The gospels fit comfortably into this relational matrix. The Evangelists also had a personal relationship (at least as teacher/mentor relationship) with their subject, Jesus of Nazareth. Their relationships to Jesus may have been less direct than those mentioned above, but the fact that they understood Jesus to be a teacher of note or possibly a divine or semi-divine figure suggests that their reasons for writing were more than academic. The Evangelists cared for the person Jesus and wanted to record his life in particular ways. This is not unlike the motives of other Contemporary biographers. They wrote because they cared (in some way) about their subject and they wrote in a genre that was well suited to telling the story across audience groups.
If you want an updated view on Gospel genre in light of recent scholarship, check it out!