Gordon has completed his LX3 review.
It's very thorough and detailed. Perhaps it will help you make your decision. You might also want to check out some forum discussions, like the New Panasonic DMC-LX3
thread, which includes links to some additional reviews and test shots.
I too anticipated something fantastic from the LX3 since the specs sound so promising. After extensive hands-on tests, Gordon gave the camera a Recommended rating, but not a Highly Recommended rating. For the sake of comparison, note that Gordon gave a Highly Recommended rating to the TZ5 (compact, no manual control) and the FZ18 (superzoom, full manual control). The FZ18 has recently been replaced by the FZ28, which hasn't been reviewed on Camera Labs yet, but it's getting extremely good owner reviews. The FZ28 isn't compact, but it is much smaller and lighter than a DSLR -- it fits easily into a small camera bag. It's currently in the top 5 or top 10 best-selling cameras, depending on whose list you check.
If you really want a versatile compact camera, the TZ5 is an excellent value, and just about everyone who owns one seems to love it (e.g., check out the TZ5 customer feedback on Amazon.com). The TZ5 doesn't offer manual control, but its Intelligent Auto mode (which automatically addresses half a dozen different factors) is extremely good.
Are you sure you need both compact size and manual control? That's going to roughly double the price of your camera. If I really wanted both, I might be more inclined to get the Canon G10 after reading Gordon's review of the LX3 and Dale Thorn's personal experiences with the LX3. If I wanted compact size without manual control, I'd definitely get the TZ5 for about half the price of the LX3. No other automatic compact comes close to the features of the TZ5. I personally don't care about compact size, but I would like the option of full manual control, which is why I'm going to get myself an FZ28. It all depends on what's important to you and how you plan to use your camera.