DSLR or best full featured digital camera?

I am needing a new digital camera, as my sony f707 is dead! I LOVED the angling lcd and need to keep the "live preview".

The features I want improved are the red eye, and the time lag between shots.

The cameras I am considering are the canon S3 IS and the olympus 330. An odd combo to be comparing! I REALLY want to keep the tilt lcd screen!

Any thoughts out there about what I would be gaining with the olympus?

Any estimations as to when other companies will be coming out with live preview on their DSLRs?

Thanks for your help!

You're right that this is an odd pair to compare, but the Olympus seems to have it all over the Canon, if the price difference doesn't bother you. First of all, the sensor is HUGE compared to the dinky 5x4 mm sensor in the Canon. (The Olympus is 18x13.5 mm.) Second of all, the Olympus actually is an SLR and you can change lenses as you wish. You don't have the complete arsenal of lenses that you might with a Canon or Nikon SLR, but they cover the range pretty well. They even have an 18-180 (equiv. to 36-360 for Olympus) to compete with the Canon S3-IS's zoom capabilities if you don't think you want to be swapping lenses back and forth.

Now... If you can still find on, a Sony DSC R1 might be worth a look. There is a flip up/twist LCD on top of the camera.

Or... The Canon Powershot A640 has a flip out/twist LCD that you would like. It doesn't have the zoom that the S3-IS has, but it is an excellent camera.

You'll be gaining more expensive memory with the Olympus!

The Olympus is a dSLR, so you'll be getting a better camera overall. Bigger sensor, removable lens, bigger lcd screen, etc. It just depends on what level you want to take your photography to. If you don't want to deal with interchangable lenses, go for the Canon long-zoom fixed lens. If you want to step up to the world of dSLR photography, go for the Olympus.

I am not very fond of the Olympus 3rds system with their lower priced SLRs. By all means I am not stopping you its just that if you want to upgrade to a higher SLR which Olympus does not offer a great one, you will have to buy all new glass. I do not believe any companies will be coming out with the LCD live view SLR's anytime soon just because they will have to make a new glass line and a new series of cameras. I got my Canon Rebel XTi just because I don't like using the LCD to compose my shots, its hard to see in bright day light and in very dim settings. Plus I do not think pros will catch onto this anytime soon.

If you want better picture quality the 330 is going to be better than the S3 because of the large sensor. But if you do not plan on buying a whole bunch of glass (lenses) for your 330 then an SLR is not for you.

You can't go wrong with NIKON or CANNON. Check out http://www.dpreview.com/ I have a Nikon D200 and love it!!