Canon sx100- purchase/possible damage problems

Jai.

This is a long post and I apologise, but please read if you have the time as I really could use some help with this, particularly if you have much digital photography experience and/or have a Canon SX100.

I bought a Canon SX100 at the end of last week. I'd been looking for a digital camera for a while, and had narrowed my choices down to the Fujifilm finepix s5800, but I found the canon in the Curry's sale for £135.99, although it was the display model. However, I looked it over, and given that the features were so much better than any other camera that I could find under £200, and having been promised (ha) by the SA that it had only just gone out on display as it was the only one they had been sent, I thought it was worth a go.

However, once I got it home, it was quickly clear that it hadn't only just gone out. There was some dust evidence on the top of the lens, but most obvious was the fact that it had two different brand batteries in it (it takes AAs), and neither were those that should have been boxed with it. It also ran out of power as soon as I started looking through the functions (I did have it switched on in the shop, but only to look at the display unfortunately). It also had a 32mb card in it (it was boxed with a 16mg that wasn't open) which had shop pictures on it, fair enough if they forgot to remove it, but the camera memory was named the first shot I tried about 90-something, so it had clearly been used a lot.

I put new batteries in and have been trying it ever since. However when I first tried it, I found the picture quality awful. The amount of noise particularly seemed far beyond what I would have thought was acceptable, given that it had mostly 9/10 or very high reviews on every website I'd looked at (they did say the noise at high ISO settings was bad, but I'd have thought that reviews would have been done taking the auto setting into account). I changed the ISO down to the lowest possible (80), and there is some improvement, but I'm not sure if this is what I can expect (the test shots on review websites seem a lot better), or if it actually is damaged?

I put some pictures on photobucket: http://s729.photobucket.com/albums/ww291/Jai_albums/ although PB doesn't seem to want to display them at full size (that IE shows them at), so they don't look as nearly bad as I'm seeing them. There's a couple of control shots in there I tried with someone else's Samsung L700 in there too.

So my question is, do these look reasonable (I don't know why they look better in PB than they do on my computer), and does this camera mean I am stuck with setting it only in modes that allow me the lowest possible ISO. The reviews were so good, I thought it was worth going for the display model. The best thing about this camera is the image stabilizer- I am bad with camera shake and these are coming out so much better than other cameras I've used.

I've put a list of the specs I was after below, if anyone has any suggestions as to other models in a price area of around £150.

Best possible image quality.
Decent optical zoom (x10 at least).
Uses AA batteries.
As compact as possible.
Around 8MP (or higher, but doesn't have to be more).

Originally I'd not factored in an image stabilizer, as I'd thought I couldn't afford it, but the difference is shocking. Also I'd been looking at the Fuji S5800, but the size had been the main thing that kept delaying my choice, as I really wanted something I could carry in my bag.

I'm so sorry this is so long- I'd be really grateful for any help.