Camcorders: Hard Drive versus SD camcorders

Hard Drive versus SD camcorders

I'm looking to buy a new camcorder (between $200-$400) and I'm not sure if I'm better off with a HDD or a SD model, or some sort of hybrid.
I use it mostly to shoot home movies. I currently have a Sony mini-DV model that's about two years old. the quality is good, but I absolutely hate tape.
Does anyone have any recommendations? I think I would rather get a high quality model with good features that shoots in mpeg format rather than getting an entry level high definition camcorder.

Also do SD models use the FAT32 file system? My digital camera shoots High definition video (.mov files) but can't shoot continuously for more than 8 minutes, because of the 2GB limit on file sizes. How do SD camcorders get around that?