Nikon also make the S10 which has a split/swivel body and a really small footprint that would allow it to fit in tight spaces - plus it is only about $250. It is 6 megapixel which is more than enough for most people's uses. The limitations are going to be depth of field (DOF) and, if you use Helicon Focus, a lack of enough focus depth control to take the multiple shots you need for Helicon Focus.
My wife has the precursor to this Camera which was called S4 and it takes decent photos. The macro mode allows you to get ridiculously close to subjects and capture minute detail. At $250 it by no means matches the quality of my D200 digital SLR (D-SLR) but I don't expect it to. Here is a close-up detail example. You can see though that depth of field is limited quite a bit:
Here is an example with the same Nikon S4/S10 used at a normal focal range (macro off) on a photo module I purposely built with lower vantage points designed for larger digital SLR cameras:
All camera's have their advantages and disadvantages, particularly when it comes to shooting models. You're either compromised with a D-SLR that you can't get low-enough in a scene or within a tight area of the layout *or* you've got a compact mini camera that doesn't have the flexibility of the full manual adjustments and lens specs that the D-SLR has.
For anyone that hasn't bought a new digital camera in the last 3 years you're going to be pleasantly surprised at how much the image quality has improved in the last few years.
And none of this takes into account your skills at using a digital darkroom product like Photoshop to correct for problems, exposure, mood, feel, color, and more...
- jamie