I have owned an S110 (like the S400 but with only 2.1MP) and currently own an S230 (like the S400 but with 3MP). To me, I would compare my S230 to a high-end point and shoot camera.
The S230 - which should be similar to the S400 on most of these - takes very good pictures. I recently carried it around on a 2 month trip to New Zealand and I have been printing and sorting the 1200 photos that I took. Now that I have had time to look at the photos that I took, I have been very pleased with the S230. Many of the outdoor shots are clear and crisp, the colors are good but tending towards muted. But the detail is very good. Even a night shot that I took of the southern hemisphere's sky came out pretty well (played with the manual settings for a while and used a tripod for this shot).
The controls are very much point and shoot. You have only rudimentary controls for adjusting white balance and auto-focus. There is no raw output mode. There is ISO adjustment but it's buried deep in the menus.
The flash is brilliant white and produces a little bit of wash-out and yet is not particularly powerful either. Low-light response of the camera is not wonderful (not surprising given the tiny lens) and most shots indoors at night will require a flash, or a tripod. Colors tend towards the bland side.
Overall, if you are looking for a small compact camera that takes good (but not spectacularly good) pictures and you aren't interesting in a lot of manual control, the S200, S230, S330 and S400 are definitely worth a look. I wanted a simple, small digital point-and-shoot and I have been very pleased with my S230. If you are currently using a point-n-shoot conventional such as those made by Minolta or Canon, or something similar, then you will definitely be impressed with an S400. I think mine, coupled with a Canon i950 printer, takes significantly better pictures than a regular point-n-shoot and photo processing at one of the big chains (Target, Walmart, etc.). If you are currently using an SLR and take your photos to a professional developer, you may be disappointed at the lack of manual flexibility and may want consider an Olympus 5050, or a Canon G3.
I highly recommend reading the reviews over at
www.steves-digicams.com and
www.dpreview.com.
I personally think that an S400 would be way over the top for simply taking Ebay photos. You could get away with a much cheaper 2MP camera and have more than sufficient quality. Also, don't get fooled by megapixel marketing. For web applications, 1.3MP is enough. If you are planning on using this long term to replace a conventional camera, and if you think most of your photos will be 4x6 with an occassional 5x7, then 2MP will be enough. If you plan on lots of 5x7's and the occassional 8x10 (which is where I am), then 3MP is enough. If you plan on lots of 8x10's then 4MP is enough. The use of digital zoom and cropping increase the need for higher megapixels, but I rarely crop my photos and my hands aren't steady enough for digital zoom anyway.