If your going to be making PRINTS, then go for the biggest MEGAPIXEL you can afford. There is a physical limit to how big a picture you can make out of a certain megapixel size.
My sony F717 that I bought 2 years ago for 999 bucks is now only like 350 bucks. Its a sweet camera. 5 megapixel, and the battery lasts for quite awhile per charge.
Thats another thing to watch out for. Digital cameras EAT batteries. Make sure you get one that can use regular batteries, so that you can run to the store and buy more if you forgot your charger. Lithium Ions. Spendy, but work the best.
My sony uses a weird battery, but it lasts so long, and I usually have my charger, that its not a hassle for me.
Digital zoom SUCKS. DOnt even bother looking at that number. You want OPTICAL zoom.
Also, some of those pocket cameras you cannot add additional lenses too. Like zoom/tele or wideangle. For most, thats not a problem, but I made sure my camera was expandable.
Most cameras use some form of removeable storage such as Memory Stick, MMC, SD, or a few other formats. Each format only works on devices designed for them. Sony is almost exlusively Memory stick format.
The trick, is to buy a "6in1 or 12in1" type "card reader". It plugs into a USB slot, and allows you to remove the memory module from the camera and place it into the reader. It then shows up as another "drive" on your computer that you can drag and drop to just like your harddrive. These card readers typical read ALL formats, so no matter what style of memory module you have, you can read it. Works good when friends bring their cameras with a different style memory, you can still read it and get the pics.