I like the Zoom H2 a lot.
Very good sound quality, if a little lacking in bottom end.... I use it for general recording, miking vocals and guitars, recording from the desk,etc,etc.
For an Idea of sound quality,I've attached an mp3 (recorded in mp3 format as the card was nearly full at the time) of my wife,a friend and myself jamming through Weller's Wild Wood in our dining room using the inbuilt mics...