totally go for a nikon d60.
bridge cameras can get good results, but they're no substitute for a DSLR. d60 with 18-55mm vr lens and i can also reccommend the nice sigma 55-200 zoom from jessops, it doesn't have the largest aperture in the world, but it's not too shabby. and it's about £125 new, so s/h..
if you do go for a compact, fuji or sony are GREAT for a combo of good shots and getting sharp, well exposed pics waving it roudn drunk in a dark room with flashing lights.
(UppityDamnPrimate LET'S OPEN THIS F*CKING PIT UP, Sat 23 May 2009, 20:03, archived)

i don't really get spending loads on heavy dslr's that are a pain to carry around and v expensive
when the pics will be reduced so they can go onto the internet
(rigby happened on (and with added toothache), Sat 23 May 2009, 20:16, archived)

but DSLRs have much less noise at higher ISOs and more dynamic range/less clipping etc.
and most compact cameras don't output RAW files/'digital negatives' so you're limited in how you can process your favourite photos

(and you need the resolution if you want to make large prints).
( custard, Sat 23 May 2009, 20:22, archived)