Lately a lot of small and relatively inexpensive hi-def digital video cameras have hit the market. One of them is the GoPro HD Hero, which has some really interesting specs. Check out the videos on the home page, too.
A ScubaBoard member recently posted this video of the HD Hero on a scuba dive in California. As you can see, underwater things look rather fuzzy, but as soon as the camera breaks the surface, it's nice and sharp. Upon asking GoPro's tech support why this might be the case, this was the reply.
Due to the curved lens of the waterproof housing for the HD HERO camera and standard def Wide HERO cameras, you do get a slight loss of sharpness/focus to underwater images. In video mode with the standard def camera this hasn't been very noticeable due to the lower resolution. With the HD HERO camera this becomes more evident at the higher resolution. Our developers are looking into whether we can possibly offer a different housing or housing lens in the future to correct this issue.
This is really disappointing, because if the video was sharp, the HD Hero would be the cheapest way to get decent video under water. Add the optional LCD, so you can see what you are aiming at, and the HD Hero costs about $350. One of its main competitors for this use is the Flip HD, which is about $200 for the camera, $260 for the Ikelite housing, and you'd probably need to spend another $250 on the wide-angle lens.
Here's hoping GoPro comes out with a modified housing or lens for underwater use... Even a flat port that slashed the FOV would be better than the current state of affairs. Advertising the depth rating of the case is also kind of misleading, since if you are looking for HD video, you wouldn't be happy with what you got under water.