If you can compromise on something between a DSLR and point-and-shoot-compact, I can highly recommend Sony's H-series. I have a H9 (now superseded by H11) and it really is good. Great quality, and you just can't beat the 12x zoom that a larger body gives you.
I was playing with one of those in the store, and I do love that zoom range. For me, I could probably compromise on that except that I'd just get the fullsize DSLR anyway (and just because of not having to carry 10 pounds of lenses with me, that H-series still looked tempting. The person its for wants something to carry everywhere in her purse though, so the H series is too big for her.
Has an "automatic" mode for point-and-shoot, turn the dial to adjust separately or together the apeture/ISO/shutter/EV. Uses memory stick pro-duo, not sure if that's the type of memory stick you have, or if you have the old memory sticks.
Yes, it is the pro-duo. The old camera was a W80, and before that a W60. It's been a very bad track record as far as how long these cameras last too.
Only problem is there is no remote / external port (that I can find - let me know if anyone knows about it), so I don't think you can trigger the camera in any way besides pushing the button on the camera body.
That's something I was wondering about too but forgot to ask. I'm pretty sure the W series doesn't have an external port either.
I also like 3D photography which I do right now with a pair of disposable film cameras, so I'm kind of tempted to buy 2 of the same subcompact digitals since $20 for 2 cameras+2 developing does add up fast.