Like many obsessive snappers, I've recently got hold of the Canon S90 camera. It's small enough to fit in your pocket, but has the kind of things that people with pretensions to seriousness like: full manual controls, RAW file support, a good sensor, and an f2 lens.
I've had it for a few months now, and I'm really liking it. It's really small, fitting well into my pocket. Although I like using my DigitalSLR, there are plenty of times when I don't fancy the bulk and a good pocket camera is very handy. I did have a Panasonic Lumix TZ3 for that purpose, but the Canon offers significantly better features for me.
I'm very happy with the image quality, particularly in low light. The combination of reasonable high ISO performance and a stabilized f2 lens, is very potent. Even my DSLR can't give me stabilization and an f2 lens. True, I only get f2 at 28mm, f2.5 at 35mm, and then it falls off. But I can get some nice shots at 28 and 35mm that I wouldn't otherwise get.
The handling works well too. The S90 has got a lot of praise for its front control ring, that goes around the lens, as well as having a rear control ring. Although I confess that most of the time I leave it in program mode, I do like the ability to get the extra control when I need it.
The S90 has salved my micro 4/3 angst. I like small cameras, but I bought into the Canon DSLR range before the micro 4/3 were announced. That made me a bit sad, as I think the micro 4/3 would have been a good choice for me. But with the S90, I feel happy about the combo of DSLR and S90, which gives me a good choice between capability and bulk.
I don't see much in downsides. I agree with others that the rear control ring is a bit too easy to turn by accident. But on the whole it's a great camera, one that I carry with me a lot.
1: Canon has since upgraded the S90 to the S95, fixing the two main niggles with it. These fixed niggles aren't enough for me to upgrade, but if you're buying new I'd say to get the S95.