Panasonic gf1 with the 20mm pancake lens is about as good as I could get for the size.
I actually sold my Nikon D3 outfit to buy one and while I'm never going to see the same results, I take better photos with the GF1 because I can have it with me all the time. I have discovered that having one of the best cameras in the world at home because it's massive is less handy than a damn good small camera in my pocket.
Totally- agree with the sentiments, although the camera is a little on the steep side (£550 from a quick Google search). It's a great camera and I know from the reviews / mags etc, that it is very capable.
Without a price range its always going to difficult to recommend anything other than general advice.
Sensors
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What Squidders is saying is right on the money - his Nikon D3 has an incredible sensor, his GF1 not as good, but still much better than a standard compact. Basically the bigger the sensor the better the quality and more crucially in low light, the less noise you will get.
The GF1 is a "Four Thirds System" and as you can see its much bigger than a standard compact sensor (the bottom row).
With a bigger sensor you can get less noise
vs
Recommendations
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Samsung WB5000 - Bridge Camera - APS-C sensor
http://www.trustedreviews.com/digital-cameras/review/2010/03/01/Samsung-WB5000/p1
Canon s90 - Bridge Camera
http://www.google.co.uk/search?sourceid=chrome&ie=UTF-8&q=canon+s90
I'm happy to give any more info/help, but a price range would make things easier.