It's alright. It's capable of making some good photos, but right now all of the compacts on the market have some shortcomings. That one has an EVF instead of a real glass viewfinder, so when you're using it it won't really feel like a real camera. It doesn't have a hotshoe to use external flashes like all DSLRs, and there's some shutter lag and it won't do too well at high ISO (in low light).

At the risk of sounding like a broken record, the Canon Digital Rebel is the most popular starter DSLR for a reason. The new versions (XT and XTI) are more expensive, but the original goes for around $3-400 with the 18-55mm kit lens, used. If buying used isn't a problem, look at the ones I listed in post #637 up there too, and maybe read the reviews on www.dpreview.com.

If you have to buy new, this one might be a good option:
http://www.adorama.com/ISGDGX1S.html
It's just a rebadged Pentax *ist DS2, which is discontinued now. Has the Pentax mount, similar features to a Rebel or D50, etc. But you can get them new for $430.

Not much point going with a compact to learn photography on when you can afford an SLR. The advantages to a rebel would be slightly faster flash sync speed (only useful when using flash in the middle of the day) and lower minimum ISO (a little bit less grain). You'd need to buy a flash card since most DSLRs don't come with one.