I just went through the camera buying process.
Go Here.
Scroll down to "5-7 Megapixel Consumer"
This is the list you need to consider.
I ended up getting the Sony P150. It gave me the most bang (megapixels) for the buck and size. Size is very important. If you can't put it in your pocket, you're going to leave it at home.
My second choice was the Casio Exilim EX-Z55. It's LCD is huge (2.5").