If you are about to buy a compact digital camera, consider these features:

Storage
Does the camera support new high capacity Secure Digital (SDHC) cards? These are the best bet for the future.

High Definition (HD) Video Capture
Can the camera capture compressed video at 1,280 x 720 pixels for playback on a HDTV? The camera should at least handle 640 x 480 pixels and 30fps.

Optical Image Stabiliser
This helps give you better quality shots in low light and when on the run.

Video Compression
Cameras using MPEG-1 or MPEG-4 video compression give you alot more video per gigabyte than standard MPEG.

Batteries
Cameras that use proprietary batteries are generally smaller but you will need to have a spare if they run out. AA batteries are cheap and easier to get on holiday, but make the camera bulkier.

BEST BUYS
UNDER $300
Nikon Coolpix L18 Cheap ($180) with a big 3inch screen and it uses standard AA batteries. The image sensor captures 8MP and it includes a 3X optical zoom lense.

Canon Digital IXUS 80 IS $240 and includes an 8MP sensor, 3X optical zoom and optical image stabilisation. Uses a proprietary LiIon battery which makes the camera very small and light.

see also:
Kodak Easyshare V1073 Captures 720p video at 30fps for only $299.
Samsung I8 Lots of features but only captures 640 x 480 pixel video. $250
Sony Cyber-Shot DSC-W150 5X optical zoom with image stabilisation. $290

OVER $400
Canon Digital IXUS 970 IS 10MP sensor with 5X optical zoom. Still image quality is very good. $430

see also:
Nikon Coolpix S600VR 10MP, 4X optical zoom with good image quality. $420
Samsung NV24HD This camera is also a full HD (1,280 x 720 pixel) movie camera. $500
Samsung NV4 8MP with 3X optical zoom that also has MP3 audio capability. $400