Well, I just bought a Canon Powershot G3 and it is EXCELLENT! However, it will cost ya $600. I am very impressed with it though. Check out www.dpreview.com for full reviews on tons of digital cameras available. You'll get the pros and cons of them and it should help you make an educated decision based on what you want out of a digital camera.
My olympus c-4000 is probaly around 400-450 now and I must say the pics are excellent and you can do so much more than you could understand. The auto stuff makes it shoot easy and the features are for professionals if need be. Here's some eye candy.