as for camera what kind of pictures you plan to take. cause if u want really good professional stuff your going to need to go over a 1000, but if its just for everyday stuff i would recomment a camera that is 3 or 4 mega pixels. and if u look in the right place you should find some good ones that are around 3 or 400 dollars. what i have found with cameras is either u go all out and get a really good one, or you just go for and average one that is around 300 dollars or less. i'm not an expert but i dont think that you'll find that much of a difference between a 300 camera and a 600 camera. dont get 5 mega pixels i find that they just waste memory you find your pics will be like a megabyte each and if you want to share them with people you'll need to condense them for file transfer. you'll want to spend your money on a big memory card so you can take lots of pictures and store them.
i jsut finished my first year and last year this exact time i was doing the same thing as you. the camera i got was a really cheap 2 megapixel one, and i have been really pleased with that one so far.