I have an Olympus C-3000Z which is brilliant. It is compact, rugged and takes great pics on Auto but offers full manual control. Smartmedia cards are getting really cheap now, see
www.digitaldepot.co.uk for bargains in memory.
I've just bought a Minolta Dimage 7i, it's at the top of the range being 5 megapixel and I use a 340Mb Microdrive with no problems.
For anyone who is interested, you can see some of my pics on
www.pbase.com/minolta/travel
For good unbiased reviews of digicams see
www.stevesdigicams.com