If I had that money and no investment in lenses I would by a Pentax K10D with the kit lens and start investing my money in old manual focus Pentax Takumar prime lenses
Image Stabilization, weather seal, great view finder, and a lineup of pure razorsharp primes.
But since you like Nikon and Canon better I would by the whatever felt best in my hand and has the best viewfinder, in the end image quality depends much more on the lens and both brands has great availability in lenses and thats what ultimately matters, the lenses
I would even consider the Nikon D70 or Canon Rebel XT(350D) if that ment I could get much better lenses. This way I would get better images and better bang for my bucks.
If you have a new family member coming up and you want really great portrait shots then a 50mm prime lens is the only way to go, and it's the most inexpensive lens too. You can get great portraits with zooms but they are no way near what you can get with a prime lens, and it's much faster so you don't need to use flash indoor. I wouldn't like to use flash in the eyes on a baby, and I generally don't like to use flash at family gatherings it's too much attention.
Zoom may seem comfortable but you loose image quality unless you spent twice your budget on a zoom.