The best image quality will be achieved with an optical zoom, regardless of the image density (number of pixels). Many lower-priced cameras have these, but not all.

My advice is to not spend a lot of money on features that you don't need today. The price of these is falling just like computers or monitors. For any electronic hardware, I consider the price as akin to rent in that if I can wait a year before buying, the price is much lower. If I can get by with a lower-priced product, I can use that and get the higher priced product for half its original cost in many cases, meaning I get decent equipment, but keep my money longer.