At first I was skeptical about the touch screen but I actually like it. It's easy to use and works perfectly and it's not as sensitive as your phone, which is a good thing, otherwise you would likely change settings just at the wrong time. As is typical with other Panasonic P&S cameras, the iA (intelligent auto) mode works great - so this camera is perfect for someone who really wants a true point and shoot to not think about things and get nice snapshots in most settings. I recommend using the settings and features to get even more out of the camera - and there are a lot of them.
Things I like about the FX78:
* Slim and stylish; easy to slip in a pocket or purse and enjoyable to handle
* Great auto (iA - intelligent Auto)
* Fast focus, start up and next shot responsiveness
*. Zoom and focus during video
* Fun and artistic "my color" settings (pinhole, film grain, high dynamic, silhouette, etc.)
* Lots of flexibility to adjust the "regular camera" mode (exposure compensation, focus, face detection, self timer, standard color, vivid color, black and white, sepia, flash on, flash off, flash slow sync, etc.)
* Great selection of scene settings to get the most out of photographing things like pets, portraits, night portraits, snow, beach, hand-held night scene, etc.
* Easy to use especially if you are familiar with Panasonic cameras. If not, it's worth a read through the manual to get a better understanding of the settings and what icon represents what setting.
* Nice image quality for P&S - The images are very nice but keep in mind this is a point and shoot camera with a P&S sensor. I would say you could easily get photos that would print out nicely at 4x6 and 5x7 and, in some cases, 8x10 that you'd be happy to hang on the wall or put in a photo album.
* 24mm ultra-wide angle lens
* 5x optical zoom (with stabilization)
* Bright f/2.5 aperture
* Nice video - although I haven't played with the HD movie mode much yet but the one quick clip I took was fine.
If you need more than 5x zoom but still want a reasonably sized small pocket sized camera, you may want to consider the Panasonic Lumix DMC-ZS7 with 12x Zoom (Black)
or the Panasonic Lumix DMC-ZS8 with 16x Zoom (Black)
Oh, the beauty mode works fine if you use a light touch - meaning that you can apply the beauty settings (whiten teeth, smooth skin, eye shadow, etc) in varying percentages. I tested it out just to see and 10% - 20% was enough for me to offer a pleasing effect for a snapshot.
Overall, I'm really having a lot of fun with this camera. I've uploaded several photos so check those out for some examples of results you can get from the FX78.
UPDATE - October 2011
I'm not that pleased with the screen resolution. I guess it is OK for people with younger eyes, but I think Panasonic should have had at least 420K on this model. It has a lot of great features and very nice picture and video quality but ultimately, I think I am going to go with a pocket travel zoom camera that has more reach and a better LCD screen resolution.
UPDATE - January 2012
I ended up selling this because it didn't fit my shooting needs best. Image quality at the wide angle was good but not so much once you started to use the zoom - especially at full zoom. I hated to part with it because I liked the look and feel of the camera so much but ultimately, it was about image quality for my shooting preferences. So if you usually like to take pictures of friends, at parties, etc, you'll probably really enjoy this. If you want more zoom, I recommend looking at another model. I think this would be a great camera for teens or twenty year olds if you can find it on sale.