I've always owned Canon cameras and was looking around for a new small digital camera and decided on the Canon SD500.  I haven't had a small camera for a few years - the last being a Canon S100 (the original digital Elph/Ixus) which I enjoyed using.  My goal with this camera is to be a companion to my digital SLR mainly for use when carrying the SLR isn't practical, so this is more of a backup camera.

First, the basics.  The SD500 is small.  It's about the size of a deck of cards.  Small doesn't mean featureless though, it has a resolution of 7.1 megapixels and a 3x optical zoom.  Storage is via an SD card.

What's in the box?  Just the basics that you would expect, a USB cable, battery and an A/V cable.  There isn't an included cases which is a shame as the camera looks like it could get scratched easily and it would be nice to have something to protect the large LCD on the back of the camera.  Canon do sell an accessory kit though which is highly recommended as it includes a case and a battery which can often be purchased for less than the cost of the battery.

Canon include a 32 megabyte SD card with the camera which will store just 9 photos at the highest resolution and quality. A 1 gigabyte card will hold about 360 images.

The camera is pretty easy to use with an intuitive menu system operated with the buttons on the back of the camera.  When turning the camera on you'll be greeted with an irritating noise from the internal speaker, thankfully this can easily be disabled in the customization menus, which also allow you to change the noise made when a photo is taken (a shutter sound is just fine thank you) and the background picture displayed when turning the camera on - not a feature I'd ever care about.  Startup time is good, the camera is ready to be used almost straight away, which wasn't the case for earlier models.  The LCD displays is large and bright and gives a good impression of the final output of a photo.

The camera has a 3x optical zoom and a digital zoom which much to my surprise was disabled by default on the camera.  I've never been a fan of digital zoom and it's nice to see Canon encouraging people not to use it by disabling it by default.  It's far better to zoom and crop on a computer than it is on the camera.

Picture quality is impressive so far.  I haven't taken many pictures yet, but I have no complaints with the output.  The camera supports USB2.0 so transfers to a computer are nice and fast - just as well with the size of the files produced.

There are a few features I want to also mention:

Stitch assist mode.  This is a great feature.  When activated the camera gives you the option of taking photos from left to right or right to left; after the first photo is taken the result is shown on the LCD display, but shrunk so you can frame your next shot against the previous shot. The camera does not attempt to stitch the photos together for you, but guides you so that you can see what you've taken so far and don't miss part of the panorama you are shooting. 

Scene assist mode.  There are a number of presets pre-programmed with general styles of photo such as "night" "portrait" etc.  The camera adjusts the settings automatically to be the best for that style of shot.  Useful for quick photos that you don't have time to manual configure settings.

That's it for my first thoughts; I'll post some more once I've used it a bit more.