As a happy Panasonic owner, I think the basic decision comes down to (a) the price difference, which favors the KM; (b) the lens, which favors Panasonic (Leica with f2.8 out to full tele versus dropping off to f4.5; both start at 2.8 at the wide end) plus (c) your personal preference about the user interface, which is different but I can't call either one "better." The key thing they both have over (for example) Olympus is image stabilization. Don't get anything with a long tele without it.