I'd recommend one of the lower-end Canon DSLRs or an EOS (whichever has the low-lag shutter speed - I can't recall). Theyre pretty cheap these days, especially if you can find one used and in good condition. My brother got his (can't recall the exact model #) bout 2 years ago for IIRC $350, and he's taken some incredible photographs with it. It was his first non-point-and-click camera, and he's grown into it marvelously. Here's some of his work with the camera, to show what's possible:
http://www.myspace.com/abram (Can't find his deviantart site - he's got a lot more stuff on there)
I've got a Canon G5 (5megapixel), an expensive "normal" digital camera that has many of the features of the SLR/EOS cameras, minus the cool quick shutter feature and the ability of taking lenses. Foolish purchase on my part, as I could've gotten more for less, BUT: I have the advantage of taking high-res photos, and I do have shutter timing, aperture, etc. control via jog dial. Not as nice as a "digital 35mm" camera, but still good enough to take some very nice photos.
Overall, I'd recommend canon equipment: cheaper than the competition in many cases, and IMO they've got the best digital photography and video chips out there by far. Anything over 5mp will likely be more than enough resolution for anything you'd want to do. (2000x1500 pixels or so? it's huge)
For photo prints up to (say) 8"x11" in size, any of the modern and recent (2 - 3 years) 'professional' and semi-professional cameras are, IMO, on par with a decent 35mm, if not superior.