I just got a Canon SD1000 Elph. The reviews are pretty good, and they’re on sale at BestBuy for only $149!!!!!!!!
Very small, but has a lot of custom features. It has good face recognition software for portraits. Get two batteries though as it uses them up quickly.
Also it takes the new SDHC cards which you can find up to 16 GB. The SDHC card I got for my SD1000 is 4 GB.
I have this camera and love it. It takes great pics for a small camera.