Am I right to think that if the V-Lux had a better sensor it might be a decent camera? Or is it that, besides that, you think the price is too high for what is basically a P&S camera (which in fact seems pretty similar to the S3)?
I think it's both. PnS cameras have been on a megapixel marketing rollercoaster and it's out of control. It's all about cramming in more mps, yet the sensors remain the same - or, if you're lucky, they go up to 1/1.8".
Look at it this way. Talking about the area the sensor (which is appropriate as that's how mp are measured)...
A Hasselblad H3D medium format digital SLR has an area of 1,728mm and comes in 22 or 39 megapixel. OK. That's about 79mm per megapixel for the 22mp, or about 44mm per mp for the 39mp.
A Canon 1DS Mk2 has a "full frame" 35mm sensor, 864mm in area, with 16.7 mp. That works out to about 52mm per mp.
Nearly all Pentax, Nikon, and Sony DSLRs use Sony APS-C sensors, about 369mm in area. In 10mp sensors, that gives you 36.9mm per mp and in 6mp sensors, 61.5mm per mp. Note that there was concern when the 10mp sensor came out about noise levels (which are pretty good though probably just slightly higher than the 6mp sensor.)
Now - point-n-shoots! The common sensors are 1/2.5" (24.7mm in area) and the larger 1/1.8" (38.2mm in area.) My wife's Canon SD600 is a 6mp camera with a 1/2.5" sensor - that means the camera has all of 4.1mm per megapixel! The top-line SD900 does have a 1/1.8" sensor - still, the addition mp means only 3.8mm per megapixel. The Leica V-Lux and the Panasonic FZ50 - exactly the same.
So, is it any wonder than a PnS camera can't compete with a DSLR, when you're talking 3.8mm per megapixel (and there are 10mp cameras with 1/2.5" sensors, too) when even the most cramped DSLR sensor gives nearly ten times the amount of area per megapixel?
Put it another way - to match the 61.5mm/mp level of my DSLR, my wife's SD600 would have to have ~
0.4 megapixels! That's not even an 800x600 picture!
What does this all mean? It means that, IMHO, manufacturers should be cutting back on megapixels and pumping up the sensors. A small PnS with a big sensor and a reasonable 5-6mp resolution could be a really, really nice camera. Of course, the tiny sensor helps hide lens problems, too, so that works in their favor...
As for comparisons to the S3/H5, this is a level beyond, due to the "real" zoom and focus rings. It should be able to give a much more compelling impressions of a true SLR because of them. Of course, for the price, you might as well get a real DSLR!
DPReview's review of the Panasonic seems to be along the same lines: "This sums up the FZ50 perfectly; a fantastic camera with a less than stellar sensor / processor, and way too many pixels."
Hey, it's all about the sensor. I'd love to see some enterprising company put a significantly larger sensor in a PnS camera. There's no reason why PnS cameras NEED to have outrageously noisy images.
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), "Starry sky", and my favorite, "Lovely skin". And ooh! It comes with a Cordura case!
And here I was thinking the V-Lux was high. 
I was hoping to find one myself this summer on the yard sale circuit. I never knew anything about them before, but now it seems I'm seeing them around a lot.
