My initial impression of the Flip HD video camera was pretty positive. But the more I use it "in the field," the more things I find that bother me. The audio is very poor when compared to my Casio EX-Z300 (a small still camera that also takes video). And in low light situations, the Flip really sucks, while the Casio is very forgiving. And if you don't hold the Flip dead still, your video shakes like pup passing peach pits. Not so the Casio.
These cameras are comparable in price. I think you can get either for around $200. And I'm open to the possibility I'm not doing something right but these are pretty much idiot-proof cameras, so…
The 4 minute video above was shot on my Casio (by my friend Greg Perry) and edited in iMovie 09 (which I like much better than 08). He was also using the Flip. The difference was night and day. Couldn't use the Flip stuff and the Casio came out okay. There's some artifacts in the video above but I think that's mostly YouTube compression. I'll post the .mov file later if you want to download and take a look.
I still have the inauguration video I shot on the Flip HD so maybe I'll see better results but I'm skeptical. If you I had to choose between the two cameras, it's no contest: Casio wins hands down. And it records nice stills and audio. If you bought a Flip on my recommendation and aren't happy with it, my apologies.
PS: Speaking of iPhoto 09… here are several sizes of this video, published to my MobileMe account.