A few weeks ago I bought the Panasonic Lumix LX5 camera. I've been using the Canon G10 as my compact camera but it's not very compact, so much so that I couldn't fit it with a case in my jacket pocket. Partly as a result I managed to scratch the lens. So it was toss up between the predecessor the LX3, the LX5 and the Canon S95. I've not used the LX3 but supposedly the LX5 has a touch more telephoto zoom (not important for me), better video (quite important) and better low light quality with an improved sensor (very important). The following shots are all at 400iso, hand held at 1/15 and 1/13th sec at F2 (very nice to have such as fast lens). I had been disappointed with the low light abilities of the G10, the LX5 seems less noisy.

I've adjusted levels but not re-saturated which I would normally do, or sharpened.

Detail of the above is pretty good considering the hand held slow shutter speed fast aperture.

Levels adjusted again, no sharpening

Reasonable detail again.
So my initial thoughts are decent low light performance, love the 24mm wide angle, nice handling although I have twice knocked the top mode dial and it's a proper compact. It will be interesting to see how it fairs this winter.
Having said all the above I was looking through a bunch of shots taken on a variety of cameras, and it was very obvious which ones were taken on my DSLR with top quality lenses. It does feel that compact cameras is one area that digital hasn't really delivered in compared with film.