Things to consider for hardware:
Unless you need still image capture (photos) high megapixels aren't important. If it is, 3+ megapixels is good for the typical 4" x 6" print. Even HDTV resolutions top out at 2 megapixels for a 1920x1080p video (2,073,600 pixels). Many times more pixels mean smaller pixels so light sensitivity goes down on the small CCD and CMOS sensors that these cameras use.
High megapixel CCD or CMOS sensors may be larger than their non- or low megapixel equivalent models. So while the megapixel models may have many small pixels, the overall size of the sensor is larger, offsetting the difference. Plus, more pixels equals higher resolution capture (to a point, see above). Essentially, you should try to get the largest sensor you can if low light performance is important.
Many people overlook the fact that lens quality of their cameras makes a difference in image capture. Ever wonder why the pictures of your cellphone looks kinda crappy? (OK, the image sensors are crap too.) Most major manufacturers use branded lenses either developed within the company (Canon) or licensed from high-end optics manufacturers (Sony = Carl Zeiss, Panasonic = Leica, JVC = Fujinon/Fujifilm). Licensed lenses are designed by the branded company but still manufactured by the camera maker (i.e. the Carl Zeiss lenses used in Sony cameras are designed by Carl Zeiss but virtually all made by Sony).
Speaking of lenses, optical zooms are far and away superior to digital zooms. Ignore the 200x, 500x, 800x, 1000x, etc. Digital Zoom numbers you see on the camera bodies, those are marketing numbers. Professional video cameras either don't have digital zooms or may have a 2x extender (i.e. a 10x zoom becomes a 20x zoom). In fact, I always turn off the digital zoom option for my cameras as soon as I start using them. Most high-end consumer camcorders typically offer 10x or 12x optical zooms instead of the 20x, 30x, or higher optical zooms on the lower-end models. Why? It's a trade-off between size, weight, and quality. Longer zooms require the light to travel farther to get to the image sensor from where it enters the lens. This means a fall off of light levels is unavoidable. To offset this effect you can use a better light gathering lens up front but those are larger and heavier (not to mention more expensive). It's more difficult and expensive to develop good high-zoom optical lenses so you'll see many cheap brands use digital zooms to enhance their numbers. High zooms (optical and especially digital) have a drawback: shakier images as the zoom goes up. Not only do you magnify the image X times, any movement of the camera gets magnified the same X times. This brings us to...
There are 2 types of Image Stabilization: the more common electronic (digital) type and the superior optical type. (http://www.videomaker.com/article/3587/
) Even in electronic stabilizations there are 2 distinct systems: EIS (Electronic Image Stabilization) like that used by Panasonic, JVC and others that track the image or subject and systems like the electronic version of SteadyShot used by Sony which utilizes motion sensors that detect the movement of the camera. Both types use a portion of the image sensor as a buffer area to shift the image to compensate for camera movement (i.e. if the camera moves up, the image is shifted down). Panasonic's EIS can be fooled into activating if the subject starts moving up and down even if the camera doesn't move.
You can also trick the systems that evaluate the CCD to determine if the camcorder is in motion when a large portion of the screen contains a moving subject. This could be a train pulling out of the station, a van driving by, or even just a person moving near the lens. One time, a camcorder tested by can Videomaker had an interesting reaction when we bounced a large cardboard box a few feet in front of the lens. With EIS engaged, the box stayed stationary on the screen while the rest of the world seemed to be moving up and down.
The motion sensor type doesn't do this. Neither do optical image stabilization systems which use either a shifting lens or adjustable prism to redirect the light to hit the image sensor correctly since they also use motion sensors.
Tape (DV, HDV): Tape is the preferred format for editing since all NLEs support DV format importing and exporting. HDV is also widely supported although you'll need a slightly more powerful machine to edit it's MPEG-2 codec video. It's easy to archive footage since all you have to do is stick the tape somewhere safe after you're done. Limiting factors are the record time (typically 60 minutes DV at SP mode or 63 minutes HDV) and the non-linear nature of tape (transferring footage to your computer takes time, not to mention that finding scenes is a pain).
Disc (DVD, AVCHD DVD): The main advantage is the ability to record then play the video back on a standalone player without having to edit or transfer the video with a PC or other hardware. AVCHD (Advanced Video Codec High Definition) DVDs can be played back on many Blu-ray machines and PCs that have software installed to handle the special format of MPEG-4 AVC (H.264) video and Dolby Digital 5.1 (AC3) or LPCM audio. Biggest drawback is that recording times are quite limited - 30 minutes at SP for DVD, 20+ minutes at SP for AVCHD on a standard 3" (8cm) DVD blank. Double Layer DVD+R discs record 55 and 45 minutes respectively, but are much more expensive than single layer discs. They are more sensitive to movement due to the nature of optical disc technology (remember how old portable CD players used to skip quite a bit if you moved them around?). Also, you may need to finalize the DVD for playback depending on the disc used and the player's requirements which adds complexity. Editing footage from standard def DVDs (MPEG-2, VOB file or other) is not an issue with most modern NLE software. Although you'd want to probably handle them similar to AMV editing from DVDs if frame accuracy is needed. AVCHD is a whole other issue due to the much higher hardware requirements to edit high definition video easily. Archiving footage can be done with storing the original discs or combining them to full-size 5" DVDs or storing the files on hard drives or other backup media.
Hard Drive (HDD): Since the files and formats used on HDD models are the same as DVD and AVCHD cameras the same comments apply. The main advantage of HDD models is the ability to record many hours of video without the need to purchase (additional) media - try recording over 2 hours with any other camcorder. Biggest downside is that there's a spinning hard drive in there and just like iPods and Notebook PCs they don't like shocks or too much movement. Another issue is that after a while, you'll fill that hard drive and you'll need to transfer off the video footage to a PC hard drive or to DVDs with a standalone recorder, although transfers to PCs are usually very fast due to most models using USB 2.0 High Speed interfaces. HDD models can't be used purely standalone like tape or disc units (unless you never intend to save your videos long term). Archival options are the same as DVD models except that you can't store the originals directly.
Flash Media / Solid State: There are many different formats available for this category and even many digital still cameras with a good movie mode can substitute for a video camera with similar quality. Quality can vary depending on the file format used, the video/audio codecs used, and at what resolution the camera captures with. For this instance, I'll eliminate all the models that don't record SD or HD resolutions (i.e. anything lower than 640x480 at 24 or 30 fps, NTSC). As such, you have your choice of memory card used (SD, CF, MS, etc.), file format (AVI, MPG, MPEG-TS, etc.), and resolution (480i, 720p, 1080i/p, etc.). The biggest downsides are the cost of the media (even at today's prices, flash memory is still much more expensive than tape, disc, or HDDs) and the limited capacities available (although this is nearly a non-issue). Editing is trickier due to the wide variety of possible formats and codecs used. Archival storage options are the same as with HDD camcorders.