I'd stick to your Nikon for stills, or consider an upgrade in that department since there are some outstanding point and shoots for around $200 available now. Any still photos you get from a camcorder generally won't give you the same quality or control. FWIW, my Panasonic minidv cam takes excellent SD video but the stills are nothing/borderline pitiful compared to the last three digital cameras I've owned. You won't get any stellar still peformance out of any of the HDD based camcorders either, if I understand correctly. But perhaps the quality will meet your needs- I just doubt it since you are already used to a fairly decent still quality w/ your Nikon.
I am in the market for a digital camcorder. I currently use an old video tape based camcorder and a Nikon 4MP digital camera. I want to buy a camcorder that I can use for both video and still photos.
This is going to be simply for family purposes. I will likely download the videos directly to my PC and then to external hard drive. I am leaning towards Hard Drive based. I want to stay in the $500-$600 range. My wife likes to download the still photos and edit them using the software that came with the Nikon camera.
The video will probably mostly be used for links in blogs and making DVDs out of them for grand parents. Nothing truly high-tech. I have been doing a lot of internet research, but there are so many differing opinions on which manufacturer and model are best.