Does anyone have a recommendation for a reasonably priced video camera? Something that will get the job done reasonably well without breaking the bank. (Or, can I get away with using my MacBook iSight?)
For doing the sort of thing you're talking about, I recommend an external camera. The recording media (flash, hard-drive, tape, etc.) doesn't really matter because you're not going to be doing hours of continuous filming. You DO (IMO) want a camera with an external mic adapter. This is important because you'll likely want a wired or wireless lavalier mic in order to get good clear audio.
Check your local craigslist. Lots of people are upgrading to newer HD cameras and selling older units. You don't need HD for what you're talking about. Just google "[camera model] + OS X" and you'll find reviews for most popular cameras of how well it does (or doesn't) work with OS X and iMovie or Final Cut.
I've had good luck with Canon cameras (but there are some models out there that don't work very well) overall.
I'd err on the side of quality as long as it didn't mean breaking the bank, which probably means I'd go the import route.
In your experience, has iMovie been enough to get the job done on the software side?
And yes, iMovie and GarageBand and the rest of the tool-chain can be used to produce reasonable content, once you get the hang of the tools, and can also be combined with the application screen recording that is available within the QuickTime tool in Snow Leopard Mac OS X 10.6.
Another area with the Apple iLife tool-chain involves how you can generate graphics (diagrams, moving plots, etc) for insertion into technical presentations. While static pages and screen captures and screen video are all easy, I haven't found an entirely satisfactory way to generate more advanced graphics for inclusion.
Also, while you're in the market for stuff along these lines... Check out the Samson C01U USB mic. I got the "podcaster" kit on Amazon for something like $140 (mic, stand, case, etc.). This is the mic you'd use for recording voiceovers or narrations, not what you'd hook to the camera for recording audio with the video.
I don't think you need super-high quality, even though the FlipCams are HD. Content counts more than style or featureset. What I like about the FlipCam is ease of use, portability, and connectivity to various video-sharing services.
The vacation was a bit of a testbed. Everybody in the family had a FlipCam, and we posted to the net a lot. After a few days, however, we realized that some sort of post-production really helped make the video much better. So I started using Camtasia Studio for basic titling, popups, splices, and transitions. It also allowed me to tweak the codec settings when I rendered the file, which was nice.
Another interesting lesson: the more you film, the better you get. At first everybody was stiff as a board the second you turned the cam on. Must be some kind of hangover from the still camera days. But after a dozen or so shots with us all watching the results, we realized that relaxing was the only way to go. The videos got a lot better at the end.
Here's a sample of the more relaxed video we got at the end of the trip instead of the start: http://www.vimeo.com/7121046
EDIT: I'm a bit of a movie buff, so this is a pet topic for me. I know that you're receiving conflicting advice, and I really can't emphasize enough how content trumps style. We found the the emotional context of a piece -- setting, reactions, flow, body language, vocal inflections, narrative -- win out so solidly over technical attributes that you can shoot a great video on the crappiest equipment imaginable and it will still be great video.
I could point to major motion pictures going the handy-cam way, like Cloverfield, or I could point to the popularity of amateur internet video, or even America's Funniest Home Videos.
But I won't.