If your fine moptor control isn't fab I'd stay away from the dinkier models. My Dad and I spent *hours* choosing cameras the last time we both bought them (mostly because we love them!) and though I went for a digital SLR with interchangeable lenses he went for a 'compact' camera that looks a bit like a digital SLR. They both have auto focus, great zooms, take beautiful pictures but he didn't feel a need to alter his lenses, so he doesn't.
He has a Sony a bit like this one:
Its Sony because we know someone who works for them, so get a good deal, but the Panasonic Lumix similar was pretty close. It gives you the option of lots of manual settings and you have a viewfinder to look through, rather than just using the rear screen, which I like.
I do think that you definately need to go and play with a few cameras, to get a feel for the set-ups. I'd head for smaller independant or London Camera Exchange shops too. Much better informed staff, in my opinion.
I love my DSLR (I bought a Nikon as it uses my pre-existing lenses) but my Dad's is a fabulous camera and unless you have a burning desire to frequently fiddle with aperture, exposure and the art of interchaging lenses, then you're way better off with a half-way house.
