I have an LX3 and do concur that it is a great camera. It's definitely the best P&S camera I have seen for shooting indoors or in low light situations. The F2.0-2.8 lens combined with better ISO performance is awesome. It also produces really nice B&W images.
The main drawback is the price. You can get a Nikon D40 (DSLR) for that price. So, if you don't mind the extra size and weight, that would be a good alternative. The other annoyance is that while the LX3 is small, you need big pockets to store it comfortably. If you plan on pocketing a camera every day, consider one where the lens doesn't stick out.