I’ve been shooting a bunch of media with the Sanyo Xacti C5, and with a very critical eye, the results are good but not stunning. I think I may be more demanding that is reasonable, given the size of this camera…
Here’s a photo gallery of a recent trip to the Exploratorium in San Francisco. Its somewhat low light in there, and the C5 did a great job.
To be fair, I use the “Enhance” tool in iPhoto to improve some of these, because it does turn great shots into really great shots. I also use the “Redeye” tool on some of these. So far, the C5 has fewer redeye shots than my old Coolpix 2500, but they’re still there. Unlike my Coolpix, the C5 doesn’t have a redeye reducer flash mode… but quite frankly I never used it in the Coolpix because when I did, the pictures where horribly under-exposed. So,I don’t miss it on the Xacti C5, and it’s easy enough to clean up when it does happen.
Here’s a shot that shows how well the C5 handles odd lighting:

Video quality is OK. Unless my memory fails me, it's not DV quality (and certainly not DVD quality, which I sometimes see in ads for the Xacti!), but it it much better than other digital cameras. Here’s an indoor shot. We have curtains on our windows that give the shot a yellow tinge.
Here’s an outdoor shot. You’ll notice a lag in the video… that’s what happens when you’re shoot video and then hit the picture button. It is nice to be able to do both, but another generation or so and they’ll eliminate that hiccup.
The audio has some issues…
For close-up shots, you can sometimes hear the camera lens adjusting to focus, which is subtly detectable as a slight clicking sound. A colleague at work has an HD-based digivid camera, and he thought the clicking sound was the HD head seeking and writing, but the Sanyo is solid state SD card RAM, so the clicking has to be more mechanical. I tried one test shot on one of my black cats in a poorly lit room, and the clicking sound is very detectable because the camera can’t find a focus.
In some scenes, I’m noticing a sputtering in the hiss, and in a few scenes, its downright distracting. Then in other scenes, the audio is nice and quiet. Here’s a sample that shows very nice macro focus, but also highlights the sputtering audio.
I’m not sure what’s causing the audio sputter, but it may be related to white noise like computer fans or air conditioning hum.