I've been experimenting a bit of late. First a Sony that I was unhappy with and then a Panasonic Lumix that I'm seriously happy with but......... IMHO you can't go wrong with a Canon. My first two digital cameras were compact Canons (they go under the Ixus brand outside of the US/Powershot inside the US) and both were excellent.
I would say the Canon G7 is good if you are i) happy to spend the money and ii) actually want to learn about photography as opposed to simply wanting to point and shoot (it's a nice stepping stone between the point and shoot world and planet DSLR).
However, there are also some seriously good value cameras from the likes of Fuji and Casio (including one FinePix camera mentioned on this forum recently that has class leading low light performance).
Before you go and spend lots of cash on a shiny new camera, I recommend reading this article:
http://www.kenrockwell.com/tech/150-...lar-camera.htm