Here's my take on it, being a DC 500 owner and having researched all the other options.
The DC500 is a nice camera. It takes nice pictures. The battery doesn't last forever, sure, but I'm not out diving to take pictures, I'm taking pictures of my dives. That means I'm taking less pictures per dive than most "photo-Nazis". SO I get two dives per battery, which isn't shabby.
The housing and strobe. It's compact, easy to use, easy to understand. The buttons are close together, but then the camera easily fits in the palm of my hand (not like resting on it, more like I close my fingers over it and the thing disappears.) It's a small camera thing, and I live with it. The housing is rated well beyond what I'm rated for. Is that a good thing? I'll call it my fudge factor. I won't ever take my housing below it's limits without first far exceeding mine, therefore my diving should never be the cause of my flooding the camera.
The price range. I bought my kit, the DC500 Elite (with digital strobe) and all the accessories I'll need for it (extra batt, batt chargers) for under $1000, with NYS tax thrown in. My LDS owner, and good buddy, just bought his strobe.....for $500. No arms by the way, just the strobe. His "comparable" camera has set him back $1500 so far. Granted, he can shoot RAW, but I'll take my D70 under if I want my pinks to be pink.
On a final note. Yes, there are good deals to be had out there on other cameras. You can get some great used Ike housings and cameras for cheap. You can get some great used strobes for cheap. You can't beat the price of the DC500 for a package deal on a new camera, without cutting some serious corners. If you are looking to dive for photos, spend the bucks and get your nice camera/housing/strobe. If you're looking to take some snapshots of your dive, look into the DC500. You might just find out it's the setup for you.
P.S. My favorite feature of the rig so far is that I can close the flash over the housing, cinch it in place with the lanyard, and hang it under my arm...and not notice it there. It just floats along like those fashionable purses, right in my pit.