Canon 570-IS -- really cheap, and really *really* good value. And it has IS, and everything else.
Have to ask Elaine to check it out - looks a bit bulky compared to the ipod-form-factor canons.
It's about one AA-battery larger in size, which makes it a lot easier to hold and aim -- and has an optical viewfinder as well as a large back LCD.
But there are a ton of slimmer ones out there, if slimness is important here. Most of the Canon cameras share firmware / features with each other, so they're all quite similar to use (less to relearn there).
The differences between pricey and non-pricey models seems to be mainly in which features get included, and which are left out of a particular model's firmware build.
Cheers!