After some deliberation I bought the Canon SD1000 black, I like the retro look, with a waterproof case. The total cost including shipping was $335. If I had some more money to toss around I would have bought the Canon G7.
Canon WP-DC13 waterproof case.
These were some of my first pics taken with the camera in the housing.
I haven't been out with the camera yet in great visibility conditions so I can't post any underwater pics that would show the quality that the camera is capable of. Here's one pic of so so quality.
As a side note I made a leap with my understanding of digital photography. I came to realize that the camera is only a basic capture instrument with a weak engine for processing the data it captured. Nevetheless the data is still there although it is not immediately apparent. A much more powerful engine is your PC with a program like Photoshop. You can take practically any pic and make it look fantastic. These pictures are heavily edited and you would not believe it if you saw the originals. Looking at it from this perspective this camera will do fine for my needs. It takes decent video as well and gives me ample time on a 4GB card.