actually, they aren't doing away with film - fuji has recently committed to continue to produce film here: http://www.fujifilm.com/news/n060119_2.html
- but for your purposes and budget, digital will be best.
don't just try to get as many megapixels as you can, look for image stabilization features. at your price point, a camera packed with megapixels is definitely sacrificing quality somewhere else in the product. it's worth losing a megapixel or two if the camera has a good image stabilization system. for example, fuji finepix has a 7.3MP camera for $179 at best buy, but a review on amazon says its terrible regarding image stabilization quality, and i checked examples on flickr and they are definitely awful. definitely check reviews on amazon or elsewhere before making a final decision.
unfortunately i don't have any other recommendations because i only shoot film - medium format slide & b/w. i always laugh when people say it's going away, because it's simply not true. =]