I have a Canon 50D at the moment with an array of lenses. Its a pretty amazing camera and it shoots 6.3fps which is a great speed for sequences and with a 1.6 cropped cmos sensor it has very high image quality.
What poutanen said about size and portability is something to consider. For me to take my camera, a couple lenses and a flash I need a bag and its about 15 lbs.
The best camera is the one you have with you, simply put. But I just try to plan to have a good camera with me
This is going to come down to what you want to do with your photos, how much you want to spend and what you want to carry. Point and shoots can be great (camera phones included) but not only is the image quality limited, what you can do with those imges (jepeg)in post production is also limited. I shoot in RAW, which means I have more of a 3 dimensional capture with all the details available so I can edit the shit out of it. A jpeg is a flat compressed version so post production is limited.
Another thing to consider is creativity. A point and shoot is almost always just auto modes, so creative shots become very difficult. With a dslr you can shoot full manual and play with Depth of Field, Aperature etc to get very creative effects. Nikon just came out with a pretty cool little camera not much bigger than a point and shoot but its full manual/auto and the lens can shoot at 10mm which is very wide. Its about $600 but its super sweet for a carry along. Also shoots HD video.
Anywyas, still need more input but hopefully we are sharing good info.
As for the error 99 - you probably have dirty contacts on your lens or battery o a loose battery door or something like that. Take you camera and give a good once over/tune up/cleaning. This could also happen if its too cold out.
Here is a sequence I shot of a buddy of mine: