Okay, I see the use for point and shoots, I've often wished for one for when carrying around an SLR just isn't as practical. They're smaller, more convenient, and the pictures they put out are usually pretty decent. There are drawbacks though.
Point and shoot cameras are smaller, which means there is less space for the sensor. Samsung just released specs for its new TL34HD. The thing has 14.7 megapixels. 14.7! Sounds impressive right? What they don't tell you is the size of the sensor.
The image sensor is the heart and soul of any camera. It's a small rectangle that is comprised of teeny tiny lenses that record brightness levels. What matters in image quality these days isn't so much how many teeny tiny lenses there are on the sensor, but how big they are. I'm no technician, but 14.7 megapixels in a point and shoot camera probably means those teeny tiny lenses are really teeny tiny, which means that they need more light in order to function properly. What happens when teeny tiny lenses don't get enough light? They fire off all funky-like and we get noise. Noise is probably a photographer's worst enemy. If I see excessive noise (more than a little in the dark areas) in a photo, its all I can look at.
It also made me angry to read about the camera's other features. Face detection? Smile Shot? 13 scene modes? Take control of your pictures people! We shouldn't allow the camera to think for us... but I digress.
Moral of the story? Don't be fooled by high megapixels. All the photos you see on this page were taken with an 8 megapixel camera, and they don't look so bad do they? Do they? That's what I thought.