A lot depends on what kind of pictures you are going to take. I have a Canon Sureshot A400 that goes for about $100 retail (probably a lot less if you shop). It zooms 5.9 to 13.2 with auto focus, flash and exposure. It is a bit smaller than a cardboard Kodak so it goes in your pocket easily. I am not sure what the max pixels is but I get good "cropable" pictures at medium resolution. It will take a 2g SD card but I shot 2 weeks of vacation pictures on a 256 card. I know I can buy a nicer camera but this is about all I need and if it fell overboard tomorrow I wouldn't feel like I lost a small fortune.
It depends on how "real" you're looking to go. In my humble opinion, the rumored Mark II version of the Canon EOS 5D will be the sweet spot. It may well be announced at PMA this year. The existing EOS 5D is also very nice. The 24-105mm L-Series lens is a good starting lens to match up with it.
In a more affordable price range, the EOS 40D is very nice.
The best of the current SLR offerings is the EOS 1Ds Mark III, at about $8,000. Plus lenses. (That's not counting medium format SLRs. They're expensive.)
Nikon has been out of the running in digital SLRs for several years, but they recently got back in the game with their latest two introductions. Their new full-frame camera has astoundingly-good low-light performance, but considerably less resolution than the Canon offerings.
I use a 10 mega pixel with 2MB card. I set it to the highest resolution and use the largest picture size possible. This does make large files that can be downsize as needed. This allow me to zoom in with clearity to read the wire size right off the wiring. It is an Pentex Optio A30. It has stabilazion and takes good night, low lit area. I have used Cannon S40 and S60 in the past. The battery goes low fast when using the flash and the night, low lit pics are not the best of quality unless you have surgeon hands. Otherwise they tend to turn out blurry.
If you are like me you will want it to be small, to fit in your shirt pocket. When it is small, you will take it with you instead of leaving it home or in the car. Then you won't always be saying "damn, I wish I had my camera!"
I got an Olympus FE-230 at Best Buy for a couple hundred. It's smaller than a pack of smokes, and takes great pics.
The only thing I can think of is to make sure the camera has a battery indicator. You would think they would all have them but a relative said their digital camera doesn't. I checked the camera and then looked through the instruction manual and found they were right. Can't remember the make/model though.
"Will it be cheaper if I drill the holes for you?"
Noticed an oddity while reading this thread... Pretty sure he asked about a digital SLR, which won't fit in your pocket--unless the term was misused. SLR are the "professional" type cameras with removeable lenses.