For most photographic needs, a good 2 Megapixel camera is all that you need. Using a decent printer with color correction and a basic knowledge of resolution, there are many 2 Megapixel cameras that can print excellent 8x10s. The only reason I see to go with anything bigger is if you want to publish or print bigger photos. Remember that the 2 Megapixel image is often a higher quality that printed negative film would yield . . .
If what you want is, as you said, a camera to record your memories and e-mail photos to family and friends, I'd recommend something small and compact that is loaded with features. The Nikon Coolpix seems to be a great product in the $200, 2 Megapixel range. I'd take the saved money and pick up a good case, a photo optimized printer, and a large capacity media card. There's no reason to spend the extra cash on bonus megapixels when you don't need them . . .
Also remember that all cameras with a given # of pixels are not created equal on the image quality front. It is entirely possible for a 2 mp camera to smoke a 3 or 4 mp camera in image quality. Having more receptive pixels doesn't mean much if they aren't arranged properly on a high quality sensor. And some of those less expensive 3 and 4 mp cameras only use 2 or 2.5 in application because the majority of the pixels actually fall outside of the image thrown by the lens.
I use 6.3 and 11 megapixel cameras for my professional work. When I get home, I use a little 2 megapixel camera that does much better than any 35mm negative film camera would. I think that in the modern world of "bigger Better FASTER!", it's really about getting what you need rather than getting what you can.
Sure, you could get the 4 megapixel camera for $400. But when a 2 megapixel camera would be more than satisfactory 99.9% of the time, why waste the money?
There are some great places to get cameras at lower prices without risk of being ripped off. B & H Photo (
www.bhphotovideo.com) is very reputable and has a great selection. Same thing goes for Adorama (
www.adorama.com). Many of the least expensive camera sites on the web will burn you. Be very careful - in the internet-camera world, a price that is really low is that way for a reason . . .
Good luck and burn that . . . film?
-PhotoPilot