For a digital camera, having physical zoom is a really good feature to have. However, usually for that you need the larger lens.
However, Nikon has some really good slim digital cameras. Their Coolpix line is rather good, and the mid-range aren't terribly expensive. The Nikon 1 line is a step in between them. They have a generally slim body, but have lenses similar to the DSLRs, though shorter.
In my opinion, those are probably the best you can get when you are talking non-DSLR cameras. All of the other brands (at least that I've tried) look like they were taken by a digital camera.
To add on to what samanime said - when speaking of physical zoom, it can sometimes be known as optical zoom. Pay no attention to digital zoom (which I never used). I also like to look for a good range of ISOs that I can select from, but don't have horrible noise.
Canon also has good non-DSLR cameras. If you want something that is a bit more powerful than a regular point and shoot but is not a DSLR, you may look at Canon's Powershot G1 X or G12 (or any of the older G series cameras if you are looking for a used one).
As for me I like Canon cameras. This company has a really good line of different cameras form the easiest ones to more professional digital cameras. You can go to the Canon website or any other selling online shop and read all specification you need. What is the best Canon or Nikon, it is always an issue and no one can give you a specific answer, because these companies are the leaders in their spheres. So someone is standing on the side of the Canon and someone likes more Nikon. The choice is for you!
I wouldn't quite say the slim digital cameras of today have the same quality shots as DSLR cameras of today. However, they do have the same quality as DSLR cameras from a few years ago (which still makes those slims really good).
If you own a DSLR already then you probably want a good balance between cost, portability and quality. Sensor size tends to dictate the upper ends of quality which requires some of the more expensive portables. They tend to only make it to the top end of portables your Canon G Series.
Optical zoom is def an important spec, but also watch the F-stop factor. Available ISO or sensitivity to light is the other one. Again these are better handled by larger sensors and more recent cameras.
Things like battery life or size (do you want replaceable AA's for emergency situations) could be a factor but are less likely if you are used to carrying a DSLR. Weight too if you want to pack light or not wanting to lug something around all day.
Peronally I've been eyeing up the Canon S90,S95 and now S100 (lol been looking for a few years now). To me they strike a good balance between features quality and portability.
I agree with buleverdi. Other than the number of megapixel, there are a few other factors that you must remember when buying a digital camera and these are battery life, zoom lens, exposure control and user controls.