Camera advice.. Nikon or Canon?

The Canon vs Nikon debate for a person just buying into a system, is pretty simple. Buy which ever camera feels the best to you and that fits in your budget. Honestly any of the entry level camera's will all take great pictures, their weakest link is ussually looking through the viewfinder. If you have friends or relatives that have a camera, you may want to consider buying the same brand they have as it maybe possible to borrow lenses from them.
 
I think you dont need to go with a DSLR, get a more comfortable camera with good abilities.

I would recomend you the Canon G15 its a P&S with all the the manual control you would get in a DSLR.

The main differences between this camera and a DSLR is

1.Size
2.Fixed lens
3.Smaller sensor

It has an optic view finder and an LCD screen, it takes really good pictures even in low light condition and has a very good fast lens.

Overall its a good camera for those who want to carry around not a very heavy, big and bulcky camera, want full manual control and not invest too much in cameras.
No doubt a DSLR will have advantages over the G15 but I think for you this camera sounds like the right choice.
I own this camera and a DSLR and I use it a lot and so does mu wife, she puts it on Auto and lets the camera do its work and I put it on manual.
 
To OP, you mention weather sealing and this normally comes at a premium cost with dslrs. The newish pentax k30 does have this feature on what is an entry level camera at a good price with lens, but I think this is still outside your budget. Don't be to wary of looking at other brands such as Sony/Olympus also. All these makers do good cameras at different price points. Nikon and Canon would have more easily available accessories and probably have a better secondhand range, but the other brands often include in body stabilisation which effectively makes every lens you have image stabilised. Canon/Nikon put this in their lenses and you pay for it -everytime. There are pros and cons to all but if you go pay 550 for a new dslr I would be surprised if its not a great camera irrelevant of brand
 
Chevy vs Ford.... but wait Canon is a Dodge in that debate
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