I was in US in 2009 for more than 31 consecutive days and fail substantial presence test. I was on B1 from July 26 to Sept 26
But I entered US on H1 on Dec 3 hence could not complete 75% presence since my first 31 days presence (July 26 to 31 Dec= 60%)
It seems there is a facility to treat up to 5 days absence as presence in US.
Can I use 3 days of absence as presence and make 2009 as first year choice for me?
If yes, can I make a choice of my spouse to be resident align as well who is in US for 28 days in 2009?

Why do you want to file resident return for 2009? You can deduct moving expenses and then your 2009 income (as on W-2) may not be taxable even if you file nonresident tax return.
On resident return, you must both report worldwide income and may also have to file Form FBAR. http://taxipay.blogspot.com/2008/03/us-citizen-or-resident-with-foreign.html

Thanks MuktatA, I would like to take exemptions for dependants: my wife and one kid who are non-earning nonresident aliens. Unfortunately company give me some bucks for relocation as part of salary, so despite using exemption for self, moving expenses I am ending up in paying up to 1500 tax if I file as non-resident alien 1040 NR. Is there any other way I can save this? I think my foreign income need not be mentioned here as it is being taxed there when I was non-resident in US. Is that right?

For purposes of this 75% requirement, you can treat up to 5 days of absence from the United States as days of presence in the United States.