Although the 500D probably does shoot nice video, its outta budget and also not that portable as the compact videos and i'd guess would have a small zoomLike JJJ said, there are some pretty nice video cameras around
grabbed a $600+ sony handycam without enough research to know the muxed audio ruins your life if you want to put it into ANY non-linear video editor i am still thinking up exactly how to dispose of it and get something that works...
There's a Sanyo HD Camcorder up on COTD today for $258. Might be worth considering if you haven't bought one yet.
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