I normally do not defend Canon too much, but I do like their stuff. I know that it is very tough for you being in the situation where your sensor is going bad, but it is not Canon refusing to include that model in the recall. The only cameras on the recall are ones with sensors recalled by Sony. IMO if you want to blame someone, blame them. Every electronic has an expected failure rate. This model seems to be above average, but it still might be within accepted tolerable limits for the industry. It also went past the warranty period, so to Canon, it completely meet its legal obligations to you. I just do not think you should rate their entire brand based on this one bad experience. Also, be sure to keep it as Sony could add that sensor to the recall.
I personally would go for the A720 just because the UW housing is going to be more reliable and useful than the camera made with it. I do believe that the Oly will have at least as nice IQ though b/c it does have a newer and larger sensor. I would not consider the zoom in the decision though b/c it is unlikely more than 3x zoom will be effective underwater.
One last thing, Pentax also makes UW cameras.
Kevin