At that price range I've always been a big fan of Canon digital cameras because I think they take very good pictures and have the best mix of qualities (sharpness, features, price, battery life etc). They seem to be able to get a good picture the first time without messing with the settings much. I have an A620 which works really well. Uses AA batteries so I don't get stuck if I forget to charge the batteries (I also have a charger). 7MP, 3x zoom, Swivel LCD, 30fps 640x480 movie mode etc. Focuses well and has a good built-in flash. Although it's a couple years old now. I think they have an A630 out that is a little better than my camera.
Or if you want a smaller camera check out the SD series. Of course there are other good cameras but there is more of a good/bad camera mix with other brands so you'd have to do some research on specific models.