Great camera if you understand photography and purchase the right lenses. I have two Canons, the Rebel XTi and the 40D. If you are just wanting to snap photos though, its a little too complicated. Not saying anything bad about you personally, but if you don't have an intrest in learning photography then I would stick with a higher end point and shoot. P&S are more than capable of great photos. Just my thoughts on this.
However, if you are interested in taking fantastic photos of everything (marbles, family, landscapes, etc), then the Canon Rebel is an excellent choice for entry level DSLR. CAUTION: if the photography bug bites you, be prepared for an expensive hobby. For instance, I spent $400+ on a macro lens (it focuses very closely) and another $700 on a flash. These two pieces of equipment were bought mainly to photograph marbles, but the lens is also fantastic for portraits, etc. Another thing to keep in mind is that some post processing of your images is generally required to get the most out of your cameras photos. This means spending some time "tweaking" your pics.
Derrick