My underwater Olympus Stylus 720 - came with box - manual - battery - battery charger - XD card - TV cord - for $30.
Yesterday - I may have solved that problem. I bought a used Olympus Stylus 720 on Craigslist. It is a tiny 7 megapixel camera with a steel case that is both waterproof and shockproof. Supposed it can be dropped from 5 feet onto concrete without internal damage and can be used 10 feet underwater. This can be done without purchasing a special camera case.
Currently Olympus is making a waterproof camera called the Tough. It sells for $150 to $300 on Amazon.com. This Olympus 720 is the model they made right before the Tough. This 720 is smaller than the Tough and in my opinion much nicer looking - more business like - less toy-like.
One of the problems I have with cameras - I want the quality pictures of a large SLR camera packed into the body of a tiny pocket held camera. The closest I have come achieving that is with my Canon G7 camera. It take marvelously clear pictures - but I can barely stuff it into the front pocket of my jeans. It is a still a bit bulky but not as bad a a full SLR camera. If a camera is bulky often times you will just leave it home.
Some people say why do you need a camera when you can use your iPhone. Simply - the iPhone takes very limited pictures - and also it is risky taking it anywhere near water. I have already experienced the hardship of dropping an iPhone in the pool.
The size of the 720 is less than 3.5 inches x 2.5 inches x 1 inch - smaller than a pack of cigarettes. It has a 2.5 inch color screen and the lens does not extend out of the camera when you zoom. It has a flash good for up to 12 feet.
The camera has an internal memory of 19 MB - but also take XD Cards that hold 1000's of pictures. You can also transfer pictures from the internal memory to the XD Card. The camera has a 3x optical zoom which can be extended with digital zoom.
Most of the time I use a camera for simple point and shoot snapshots. This camera does have 30 programable setting - like beach - twilight - backlit - etc. I seldom use those settings.
Besides taking regular pictures the camera takes standard 640 x 480 video. Imagine catching a underwater video of that shark as he is about to take off your leg.
The camera sold new for $399. That was 3 years ago. You can still buy one on Amazon for $99 - but I was lucky enough to find this one on Craigslist. After a little bargaining - the owner dropped the price from $45 to $30. Never pay asking price.
Imagine that - a really nice underwater camera for $30 - no tax - no shipping :-)