Harsh, very harsh. I have friends who graduated in 09 who are only now getting permanent professional positions. I'm not as close with the class of 00/01, but my understanding is that they also faced significant difficulties. I was lucky enough to graduate in 05, one of the four years (04-07) within the first 15 years of this millenia where it was reasonably easy to get an entry-level job. As a result, I had 4 years of good work experience when I ended up at Google in 09. I'm not sure I could've pulled off the same thing as a fresh grad, given that they were barely hiring.
The National Bureau of Economic Research published some research into the effects of graduating into a recession, and it takes about 10 years to catch up:
http://www.nber.org/digest/nov06/w12159.html
If I were you, I would take the full-time engineering role at a big company and then look at doing a masters part-time. Many of the big companies have tuition reimbursement, and as a fresh grad, you have more time available than someone with a family and career responsibilities. Then, when you've got the masters and a couple years of work experience under your belt, switch into the job you really want.
