I've just bought a Nikon D80 off a mate
Lovely bit of kit and has three remotes with it! lol!....Wired, IR & Radio 
Nice camera, are the lenses interchangable?
Oooooo yes!

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......having taken the same picture on all MP sizes, it has proved in the 4 years or so I have owned the camera that I have never needed more than 3MP but most times use maximum zoom.
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My advice at this current time is this...given the fact that storage space (computers, memory cards) is sooooo cheap compared to what they were a few years ago and
crucially the fact that you may only get to take a (valuable) picture just once, I would be using the best pixel rate you can get from the camera.
The Nikon I mentioned above takes 2 copies of the same picture, one in standard jpeg and one in RAW format, RAW storing more of the critical information needed for editing later. It means that each image runs to about 9MB from it's 10.2megapixel sensor. The 2 pictures together running to 18-20MB per shot. You can't get that information back later. Your existing 3mp camera shots will also start to look grainy on a big print or a larger television (HD) which everybody has these days!
Given your interest in photography it sounds like you definately want a decent camera, as the others have said, go second hand for a better deal. Camera users tend to look after their equipment and many shops offer guarantee, or get one that has been 'factory reburbished'.
Treat yourself mate, go into a shop, have a hold of a PROPER DSLR camera and ask some questions, take some pictures, the shop owner won't mind, that's what it's all about. See what feels right for you, nikon/canon being the two most popular. A bit like the ford/vauxhall or Merc/BMW scenario, whatever floats your boat.
If you are still in touch with your web-designer mate you may be interested to know that the lenses from the higher end Fuji cameras are compatible with most of the better nikon range

Have a little word and see if you can play with a few lenses. In fact, all nikon lenses are compatible with the better nikons. Canon, you have to be a bit more careful what works with what.
The money you have mentioned (£500) is a great budget for a camera and should get you a nice bit of kit. It isn't a lot of money to spend for capturing some great memories so go for it mate
