I was tired of worrying about handing my camera over to my 2yo son William. He loves to take pictures though, so I decided for xmas to get him and I a new rugged camera. This way we don't have to worry as much about him breaking it while practicing his photography skills. I can just hand him the camera mostly without worry. There has been a leaning towards rugged electronics after my son put my cell phone(handy) into the dish washer. I had decided before as to some camera specifications and recommendations before. Everything in life is a compromise though and this is no exception to the rule.
Pros: SDHC card(using EyeFi wireless card), ultra-compact, 12megapixels, 1.5meters shock proof, 3.0meters waterproof(and dustproof), Optical Image Stabilizer, great reviews, video with HDMI out, and 4.6x Optical Zoom, underwater housing available for SCUBA diving.
Cons: Special Li-ion battery is pretty much a requirement in an ultra-compact camera, it's a bit on the expensive side, special USB connector(but I have an EyeFi Card, so it won't be used).