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Another glowing endorsement of the Canon Digital ELPH series. I love mine--it's smaller than a pack of cigarettes, and takes amazing pictures.
Sony is also a great camera maker---I took one to SE Asia when I was there this past winter. I used the VGA setting, which is primarily for screen (lowish resolution) display, as it allowed me to take 170 pictures on each Memory Stick. They look amazing onscreen, and are even pretty good printed out (4 by 6 inches). For full resolution pics, the results are just as good.
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