For the most part, they are identical.
The picture quality is identical.
The 870 has a wide angle lens (28mm focal length)
The 850 has a 35mm focal length lens (considered normal focal length for small digital cameras).
The 870 has a 3 inch LCD but no viewfinder
The 850 has a 2.5 inch LCD and an optical viewfinder.
A Note: Wide Angle Lens
Most people don't really have a need for a wide angle lens.
People in real estate, contracting, interior decorating, etc have a need for wide angle.
Here is a look at their specifications:
I'm having a hard time deciding on which camera to purchase. I like both as far as control layouts are concerned but I can't seem to find differences in the 2.
Could anyone owning one of the two models explain why they like that particular one?