I have a Canon s30 and I love it. It is a 3.1 megapixel camera and we get great pictures from the camera for the most part. My dad has had a digital camera for quite so time and my wife and I hesitated on buying one for a while because we were not sure the pictures were as good as film pictures. We finally bought one and after taking a few pictures the first week and having some printed I was disapointed with a few pictures. After a few days I got out some film pictures and guess what, they are not perfect either. A few things I saw in the digital pictures that bothered me was red eye, a few out of focus, etc. The film pictures had exactly the same problems but we were never that critical of them. We just looked at them and enjoyed them. So I would recommend a digital camera 100%. The things you can do are amazing. If you want actual prints of the pictures you can do them yourself or there are printing services such as ofoto.com (kodak) or dotphoto.com. The pictures I got from ofoto look just like pictures you would pick up if you dropped film off. You just upload files to their web site and you get the pictures back very quickly in the mail. I also have a program from ulead.com called DVD Picture Show, they have a trial at the website. This program is simple to use and with a cd burner you can make VCD's that will play on a lot of DVD players that shows your pictures on the TV (vcdhelp.com has a list of players that work with VCD's and CD-R's, if yours doesn't work Wal-Mart has an APEX DVD player for 80.00 that will). I made a slide show of our
Disney Cruise and added the music "When You Wish Upon a Star" and the pictures look really good on my 46 inch TV. Most cameras come with software that allows you to print several pictures with bacgrounds and words, etc. on photo paper. My camera came with a program called Photorecord and it is very simple to use. It makes colages that look really good. I have a 125.00 printer that prints these very nicely, it dosen't take an extremly expensive printer. The digital pictures are easy to store and organize.
We also purchsed, for our kid's great grandparents, cevia frames. If you haven't seen these they are a digital picture frame. They plug into a phone line and download digital pictures that you upload to the web site. They cost about 100.00 with rebates (I think) and there is also a small charge for the service. It is a great way to share pictures with relatives that are far away and don't have a computer. Once it is set-up the person that has the frame doesn't have to do anything.
One thing you may want to keep in mind is that the 400 pictures you used to take may only be 300 with a digital camera. If you are like me you take 2 or 3 pictures of everything with a film camera in case one is bad. On the other hand you may take twice as many. With a digital camera you can review the pictures on the cameras LCD and delete the pictures that you do not like. I bought a 128 meg Compact Flash Card for 80.00. If I take pictures with my camera at the highest resolution it will hold about 80 pictures. The price of these cards continues to drop so look around.
dpreview.com has a ton of information.
I would recommed the camera I have although I can't tell you it is any better than any other. I like the size, it is not too big but it is also big enough to be able to get a good hold on. One thing I would suggest is that you buy at least a 2.1 megapixel camera. We did at one time have a camera that was about .5 megapixels that we got from my dad when he upraded and although the pictures were good to e-mail they were not that good to print.
As you can tell from the length of my message we are very excited about our camera. We have put the film camera away and only use this. We had a new baby three weeks ago and the day after he was born we had pictures sent by e-mail, pictures sent to great grandma's frames, VCD's sent to great grandma's, colages printed and displayed at the hospital, and announcments printed.
I want to add that I work in sales for a livestock nutrition company. I am not a photographer or a computer expert. Most of this stuff is very easy to do with the programs available. It does not take a lot of time. My computer is several years old and although it is slow to do some of these things it works well. You don't need a new computer to do this (don't tell my wife this though because I have about got her convinced that I do).