Coveting a ditigal SLR

For more than a year, Beloved and I have been talking about getting a digital SLR camera. We started talking about it in abstract terms, a "someday" kind of wistfullness. Beloved is a master at overcoming my resistance to the purchase of new home electronics - I was opposed to the DVD player, the laptop, and our current point-and-shoot digital camera, to name just a few of the things I completely opposed in principal and have since come to know and love. But over the last six months, the "someday" wistfullness has crystalized into me searching sites for product reviews, best prices, and feature comparisons.

The problem with the digital SLR is that I really, really want one. I took a couple of photography classes over the years, and I was just getting comfortable using my dad's 20 year old Canon AE1 hand-me-down when we capitulated to the world of digital point-and-shoot cameras back in 2003. I think I'm a pretty good photographer, and I already know my way around f-stops and focal lengths and aperture, and would really like to have the chance to try out those skills on a digital SLR. I want one, but I can clearly see that we don't need one.

I do love our little Canon Power Shot (or is it a Sure Shot?) and it's done us well over the year, but I fear after a scant four years, it's on its way to meet its maker. They have a bad reputation for the LED screen dying after just a few years, and ours has already lasted longer than some other friends of ours who have the same make and model. At the time, we spent more than $500 including taxes and warranties, so if we're going to have to get a new camera anyway, it seems reasonable to me to spend the extra and splurge on the digital SLR.

And then my cheap side speaks up and chastises me for coveting something so expensive when we already have a perfectly functioning (so far) camera that takes lovely pictures. And I start thinking that for the price of an entry-level digital SLR (and the taxes, and the warranty, and whatever accessories we absolutely must have) we could replace our ugly, unmatched and quickly deteriorating living room furniture. Or we could do a really good job of turning our partly finished basement into a kick-ass playroom/family room. Or we could replace the ugly sky-blue carpet that I hate so much with at least laminate on the main floor, if not hardwood. Or, you know, we could do the responsible and adult thing and pay down some of our rather outrageous consumer debt. Yah right, as if that's going to happen.

In my brand and feature comparisons, I've narrowed my choices down to a basic Canon Rebel and a Nikon D40. Since we already have a Canon, I understand that the couple of hundred dollars' worth of memory cards we have would be compatible, which is a definite selling point. Plus, as I said, my dad has a lovely if not antiquated Canon AE1 with some very cool lenses, some of which may (or may not) be compatible with a new theoretical Rebel, should we be able to convince him to donate them to our cause.

I even toyed with the idea of picking one up while we're down in the States, but Beloved loves his extended warranties, and I'm not sure how well they'd translate cross-border. Besides, with the Canadian dollar creeping towards par, I'm not sure the savings would be huge or worth it.

I'm on the fence, but canted dangerously at an 85 degree angle towards capitulating to my desire. So, whaddya think? Do you have a digital SLR? Do you have any recommendations, tips or thoughts? Go on, convince me. Beloved will thank you for it!

Edited to add: Thanks for all your comments and opinions. You twisted my rubber arm. We are now proud owners of a Nikon D40. I'm in love!