What is a better overall camera..the Canon PowerShot SD1000 7.1MP Digital Camera or the Sony DSC-N2?

Go here and click on "Read owner opinions" for each camera. You can read each person's comments.

http://www.dpreview.com/reviews/compare_...

Just looking at the chart...

The Sony costs $100 more, so of course you get these features that are better than the Canon:

-10 MP vs. 7 MP
-Sensor that is twice as big - usually means better image quality
-Lens is very slightly "longer" on the telephoto end
-Some degree of manual focus control for the times autofocus won't work
-Cool whiz bang touch screen

Is the Sony better quality or not? I really don't know.

If you are able to go up to that $350 price, though, look at the soon-to-be-available Canon Powershot SD850-IS. Awesome.

SD850-IS (IXUS 950 IS) Preview: http://www.dpreview.com/news/0705/070507...

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I would choose the Sony. It looks better, it has more megapixels(something I don't really care for, because its just a way to suck in more buyers), and it has better looking pictures.
The Canon looks good, too, but it falls apart when using high ISO.

both are good
I would go with the canon