I chose this SLR camera over the Canon `Digital Rebel' largely as could take the xD cards I have, and I could get the official twin Olympus kit lens for £100 less than the Canon offerings. Plus having lost a `sealed' compact to dust on the sensor the Olympus vibrational dust removal CCD system is great idea. Basically the camera feels like a traditional SLR, holds very well, and is relatively easy to use, although many useful things, and there are a lot of them for your money, are hidden in the various menus - like ASA's above 800 needing an on/off to activate. See the independent site dpreview.com for an excellent review of this camera and it's main digital SLR competitors available on Amazon. Picture quality is very good, although rather noisy above 400 ASA. Having to swap lenses to get more than 3x zoom is also a bit of a pain. I have got used to a 12x zoom compact, and I tend to leave the telephoto at home as the camera bag is rather weighty with it stashed in. Naturally you need to get a generic second battery, although the supplied battery is good for few days intensive shooting. Like all digital cameras, the excellent back LCD screen is at very high risk of damage from face contact and scratches so I applied a [PALM branded] screen protector, cut to size, before use.
The only downside is the painfully slow USB 1 (no USB2) transfer speed (up to twenty minutes for a days shoot), no top notch autofocus (up to three focus areas not five) and the stupidity of no distance markings on the manual focus ring. So when you try to use manual focus in the dark you find it virtually impossible to set focus manually, whereas you could easily twist to say 3m or infinity on the lens ring if it was there (or shown in the menu). The focus ring just spins round and round and you don't even know which way the focus is going - although I believe this does prevent the manual focus damaging the focus motor. There's also no focussing light aid other than the very short range flash. Having to use the pop-up flash to focus in the dark is also a real pain unless your wish to dazzle the subject (I never use it and switch off the auto pop-up and flash focus aid - the camera focuses far better without it anyway). It also tends to overexpose a little and you often forget to compensate after it returns to default - if you stay on Auto or suchlike it does remember settings though. It's also very noisy at high ASA compared to the Canon and Nikons, and unfortunately I find I use the camera a lot above 400 ASA. Plus you have to pay a little extra to upgrade the limited supplied software to the excellent Olympus Master Pro version - rather annoying on a camera of this price.
But if you can live with the downsides, the camera has a lot to recommend it. I couldn't find any SLR for the price that had everything I wanted, and this SLR offered a good compromise. It has so many features that I'm still discovering some. I also bought the Olympus EX-25 'extension ring' from Amazon for real macro shots. Keep your quality 12x zoom compact though as this is large, intimidating, noisy, obtrusive and heavy beast for some places.