My iPhone 3GS has actually got quite a good 3MP camera in it. For most people, it's all the point and shoot they'll ever need. it's my backup, and I use it often.
My go-everywhere camera is my 12MP Optio A40. I never leave home without it. I even carry it when I have my DSLRs with me, just in case. It does a great job, but its lack of versatility is the only thing keeping it from being my only digital
My first digital camera was an Intel webcam/digicam combo. The pics it took were low-resolution but clear, even in dim light.
The first "real" digital I had was a Kodak 1MP (Actually .99 megapixel but Kodak said one) digital point and shoot. No zoom, and bulky. Still works!
I then had a HP Photosmart 230 (2.1MP) and then a 420 (4MP). Both good cameras. The 420 had a Pentax lens, but chewed through batteries like crazy.
All in all, it's amazing how far digitals have come, especially the point-and-shoot market. DSLRs are just amazing, but for how much they cost they should be.
Now that everybody has a digital, I enjoy being the odd one shooting film