We've owned a Nikon Coolpix 900 for two years now, and i gave it an extensive workout on an 8-week trip this summer. The 900 is a 2.1 megapixel, while their newer model, the 950 is one of 3.1 megapixel variety. I shoot all my pictures at the normal setting, so the files have a nominal size of about 420K, allowing 16 shots on an 8meg card, 64 on a 32meg card. For the trip this summer I purchased a 128meg card for $125, (compact card prices are dropping, but not that fast.) The 128 meg card allowed 256 shots. I also took along a laptop computer to download the pictures at regular intervals, particularly before taking long hikes. It worked out well, but when the card prices get lower, I'm just going to buy cards, the bigger the better. NiMH batteries are indeed a must. The 900 takes about 60 pictures on one charge. I carried four sets of batteries and ran the charger from the car cigarette lighter while driving. So in truth power, not card space is the bottleneck. I also used the LED screen to frame pictures using a wide angle lens on the camera most of the time. Nikon offers some nice optics for its Coolpix series.
The standard for digital pictures gets better and better, but my 420k jpg shots are extremely clear. I don't know what the new normal standard for the 3.1meg cameras are, but because they have more online memory capacity they can process bigger pictures in a convenient amount of time. Even the 2.1meg camera can process a mini movie shooting the very small .vga files. If you intend to make portaits, you'll be interested in shooting .tif files. An 8meg card holds only one of those. Tif shots are too big for anything else, emailing, whatever. Saving them will eat up lots of space. Get a card reader as mentions. Camera to computer is too slow. For laptops they make a $10 adapter that receives the compact flash card from the camera and then allows it to slip into the laptop PCMCIA slot for a direct download. Very handy and cheap.
From processing the summers shots, I narrowed down about 1700 shots to 1400, which fit on a 650MB CDRom disk. That is the need mode of showing pictures to friends. Give them the disk. Windows 2000 also has a nice screesaver that shows your pictures stored in a special "my pics" folder on your hard disk in random order. It makes looking at pictures effortless.
Coolpix offers the best macro (closeup)shooting as it can focus as close as 7/8 of an inch. This also allows it to be a dandy slide shot duplicator. I have about 5000 slides I intend to digitize before the emulsion gets any worse.
What I don't like about the Coolpix and every other digital camera made in the compact 4"x6"x1" size is that the LCD screen is useless in sunlight. You can buy makeshift sunshades for them to get by, but the camera companies should get their act together and do something about this. My sunshade is a metal unit with a 2x magnifying lens that renders the camera something like the old single lens reflex cameras in shooting. Still, if I bought again, I think that I'd abandon compact size and get a more professional digital that is built around the old SLR styling and can accomodate professional lenses. I'm a wide-angle buff in both landscape and indoor shooting. Humans see in wide angle.
If you intend to shoot indoor shots often, and many of your shots are beyond 10 feet, the camera flash is inadequate and you'll want an add-on flash. Of course this is more to haul around and that's always the tradeoff. The compact cameras take excelent pictures and they are idea for hiking or carrying to functions where you might want a few memory shots. Nothing will ever beat silver oxide for image clarity (molecules are an awful lot smaller than pixels), but the pictures are excelent and flawless to the normal uncritical human eye.
I'll never go back to film! Once you have the equipment, pictures are essentially free. You'll get better pictures because you'll shoot more knowing that they'll come out with developing and printing cost. When you shoot a lots of shots you are bound to get the four or five fabulous shots you wanted of whatever you are shooting. Emailing pictures is a pleasure. The digital advantages can't be beat.