Good that you asked here, I didn't know there were many people here who did photography. I'm an optical designer, non-imaging and imaging stuff both will do, and I also do some amateur photographing.
I personally use Canon 20D (or D20, I never remember), and a 28-300 mm zoom lens (by Sigma) with maximum aperture number of 3.5. Found out that it is quite sufficient for my photographing purposes, though I have been thinking about buying an objective that would have a power of 1.8 to make indoor photos without the flashlight more feasible. The camera has 8 megapixels (IIRC), and is supposed to take nice A3 sized photos, though I have only tested A4 sizes yet - and they looked quite good. The price was something like 2500 € - I expect the camera to live several decades, so it isn't that much after all. Be sure to buy a camera on which you can change objectives.
The thing that you should consider is the drawing capability of a lens, the megapixel number will not itself determine the amount of details that can be resolved from the picture. The actual limiting factor is the drawing capability of the lens and the pixel size. Typically, any SLR lens (with price of ~ +300€) from Canon or Nikon is good enough for photographing purposes, though I recommend trying it in the shop before buying. It is good to pick a camera from famous brands, as it is likely that other lenses by the same manufacturer will be compatible with it.
When buying the lens, it is good to check the image quality at corners of field of vision at the macro and tele end of a zoom lens. This way you can see if the designers have compromised image quality at the edges for higher magnification or f-number and you get an idea if it is good enough for you.
If you expect that you might need the flashlight (low level lightning cases, this is relative, since it might happen also in direct sunlight!), be sure to pick a good extra light source. Directly flashing someone with a flash makes skin look unnatural from my point of view, it is better to use diffuse lightning, meaning that you should direct the flashlight towards ceiling or walls, and trust the diffusively reflected light for more natural kind (even) of illumination.
Though I don't like using flashlight, there is one case where I need to have a flash, which is photographing someone's portrait outside against the sun (preferably woman during sunset). The sun itself is a strong light source, and the only way to get the person's face illuminated (back of the person's head will block light that would illuminate his face) is to use flash that will briefly illuminate the face stronger than the sun.
That's about it for starters
Mika
