in response to the noise question:
That is totally normal. ISO refers to the speed of a film, eg 125, 500, 600, 1800. Higher ISO (or ASA in the old days) in a film produces grainier photographs in order to allow for shooting in darker conditions. The trade off is more noise and shooting in darker conditions or less noise and possibly blurry photographs.

Wikipedia says:
Film speed is roughly related to granularity, the size of the grains of silver halide in the emulsion, since larger grains give film a greater sensitivity to light. Fine-grain stock, such as portrait film or those used for the intermediate stages of copying original camera negatives, is "slow", meaning that the amount of light used to expose it must be high or the shutter must be open longer. Fast films, used for shooting in poor light or for shooting fast motion, produce a grainy image. The image actually consists of a mosaic of developed and undeveloped areas of the emulsion, and each grain of silver halide develops in an all-or-nothing way. Thus, film is a threshold detector rather than a linear detector. If the subject has an edge between light and darkness and that edge falls on a grain, the result will be an area that is all light or all shadow. An accumulation of such areas breaks up the visible contours of the object, the effect known as graininess (or grain). Fast films are also relatively contrasty, for the same reason. That is, an area of the image will consist of bright areas and dark ones with few transitional areas of midtones.

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_-Mike

In response to very-COLORFUL:

Consumer cameras such as those of the fixed-lens and point-and-shoot variety may produce sharper images with more vivid colors in most instances, when compared to DSLRs.

In general, the more expensive and higher-end the camera is, the more neutral the results become. This means that pictures will seem softer and the colors more muted. Very conservative processing is done by the camera in order to ensure that the user has full control over the final image.

Not sure if I remember correctly, but take this as an example: setting +1 to sharpness on a 350D is equivalent to +2 sharpness on say, a 5D.

Once the photo is taken from the camera it can be further processed in Photoshop to improve the colors (via Hue & Saturation, Contrast, Curves, Levels, Photo Filters etc) or sharpness (eg. Unsharp Mask). This is all post-processing.

However if you want better colors and sharpness at the shooting stage, consider the following:

-shoot from a tripod/ stable surface, using a remote release to trigger the shutter, or use the self-timer mode. When shutter speeds start to drop due to falling light levels, or when you shake a lot due to the coffee you drank at breakfast, the image can become blurred.

-ensure that you got your focus point right. I always use the central focus point only so that I can get the focus exactly where I want it. Unfortunately it can be a bit slow for motion shots.

-add a polarizer to your lens. It will cut glare and reflections, and allow the deep, true colors to come through. I've seen spectacular examples in books and most landscape photographers agree that the circular polarizer is one of the most important filters you should have in your bag.

Now, on the issue of noise...it is normal to see a greater level of noise at higher ISO levels. This is also the case with films. That being said, the difference between ISO 100 and 200 seems minimal, especially when shooting in daylight. As exposure times increase, there is a definite difference. With ISO 400 and above, noise becomes visible to my eyes even with daylight photos.

Noise is even more apparent in shadow (dark/ black) areas regardless of ISO level. Do note too, that if you oversaturate things in Photoshop, some color patches can take on a grainy appearence that resembles noise.

Again, if you do not require high shutter speeds to freeze motion or avoid camera shake, consider using a lower ISO and mount the camera on a tripod for shooting. Alternatively, look for lenses that are equipped with IS.

Canon users are priveleged in general, because images are usually very clean up till ISO 400, and even ISO 800 isn't bad. ISO 1600 can still be cleaned up with software such as Neat Image, Noise Ninja etc.

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