Olympus is a great camera company and their cameras take great pictures. Olympus makes some of the best water proof cameras. You will get top notch images from Olympus. I use Olympus DSLR cameras and my Friends were surprised by how good the quality was, especially given the price. Olympus quality is every bit as good as Nikon, Canon, or anyone else out there. And Olympus tends to give you more for your money, so you get a better deal over all.
although u can use warerproof cases for the canon, id say go for oly 1030. it takes good pictures compared to the 850.
Olympus cameras have stellar optics and are very well made. The AW & SW models have a reputation for being very rugged and the water resistant models are usually very good mechanically, too.
The number of megapixels is not nearly as important as the quality of the camera & lens and overall performance of the camera and software.
Here is a link to my flickr page. All the digital images were made with Olympus cameras from between 3 and 8 megapixels.
http://www.flickr.com/photos/robs-photo-...
To decide on a specific model I would recommend looking at reviews at Steve's Digicams (see link below) because he does fairly extensive and objective reviews of many cameras. His reviews all have a section called Steve's Conclusion which is a good, quick overview of his evaluation.
http://www.steves-digicams.com/hardware_...
HTH. Email me if you have specific questions about a particular model or feature.
even if the camera isn't waterproof
canon takes great pictures