$200 was my budget too until we got to the store & DH said we only buy a camera every few years so if we have to spend a little more, fine, just get the camera you want...it's for my birthday this coming Friday but figured pricing would be key on Black Friday. I had my choices narrowed down to Nikon or Canon - Nikon lost out because I don't care for the slim cameras.
This is what I got on Friday ($249) and was able to get it up and running that night. Took it for a test run on Sat. at a kids party and really like how it functions. In the 200 range there are alot of options but found that I like the bulk of Canon over the "slim" style cameras (personal opinion). Also Canon seems to get slightly better ratings over Nikon (another great option). Get as many megapixels as your wallet will allow. Other issues I had and had never even thought of till someone else looking at displays were many digital cameras only have the screen to view your shots - no lens viewer. If it is sunny out it is difficult to view the screens so a viewer is key.
Canon® PowerShot® A620 Digital Camera and PIXMA® IP6220 Printer Bundle
Snap and print on the go.
Take and print pictures wherever you go with this camera and printer bundle.
Bundle includes PowerShot® A620 Digital Camera and PIXMA® IP6220 Photo Printer
Take pictures. Then simply dock your camera and touch a button to print
7.1 megapixel camera
4x optical/4x digital zoom
Accepts Secure Digital (SD) memory cards
2.0" color LCD
PIXMA® iP6220D Printer has 60-second print speed, 2.5" color LCD screen, up to 4800 x 1200-dpi resolution and built-in card slots