About two years ago my old Minolta "point and shoot" camera, which I paid $1000 for around the turn of the century. I sent it back once to be fixed (zoom was stuffed), and it cost $500 to fix. Two months later it was stuffed, so I decided to replace it. My thinking was "bugger it - lets buy something that doesn't suck".
Canon had not long released the EOS 350D (sold as Digital Rebel XT in some markets), an 8MP digital SLR camera aimed at the enthusiast market. At the time I didn't know much about photography at all, so it was an ideal camera. Cost about $2100, including two lenses - an 18-55mm, and a 75-300mm kit lens. Of course, the current equivalent kit from Canon costs under $1500, and if you're looking for a camera, it's probably a good pick.
The bit I didn't realise was how average the lenses are that are in the kit. Earlier in the year I started doing some photography courses with Ben from Fusion Photography, who's a real passionate professional wedding photographer. I think we've done about 12 hours worth of lessons with him, and it's amazing the difference it has made to the photos I'm taking. A mix of skills learnt from Ben and better lenses (my latest purchase is a 70-200mm L-series Canon lens) has made quite some the difference.
Earlier I ran out of disk space on my laptop, and needed to clear some space, as I downloaded the trial of Adobe Photoshop CS3 for Mac (Intel). Over one third of my disk space was photos, so I decided to clear them out. First time I'd looked at some of them since 2005, and there were some shockers there which I had once thought were ok. Lots of them were so dark, and it made me realise how good the f2.8 L-series lenses were compared to the f4-5.6 lenses you get in a kit. Might put my old lenses up on eBay, and just get rid of them.