Well, I must admit that while I didn't buy the Treo 650 for its camera, it does a handy job of taking pictures. It does this better than the Treo 600, which has terrible low light sensitivity.
Almost more fun than taking stills, it takes passable videos. They're just 320x240 and only 15 frames per second, but I think they'll look fine as part of a media collage. At least I don't need to carry my Panasonic DVR everywhere (not that it is anywhere near as good). ;-)
I'll post about this later when I have a chance to try putting them into an iMovie.