Look for at least a 7 or 8 Megapixel camera. If you can find something higher within your budget you should look into it.
Seriously 7-8 MP or bigger? Don't get caught in the more is better. Sensor first. Everything coming out new that isn't 'novelty camera at the check out lines' is more than adequate.
Who really prints bigger than 8x10 anyway? (And you can do 18x24 and much bigger if you know what you're doing with a 6mp camera)