My kids (11 & 9) also have the intel play camera (which is the same as Digital blue) - they also love it. So I was also looking for an upgrade. Here's what I found out (from reading reviews and ads):
American Idol Digital: Same camera as original, only 4 minutes tape time, new backgrounds
Digital Blue 2: Same camera, more memory (records twice as long) approx 7-9 minutes
Vcam: By same makers of video now, same memory as new digital blue ~7-9 mins
Vidster: Same memory as new cams (vcam, new digital blue) 7-9 mins
What I like about digital blue is how easy it is to upload the clips and create movies (that is why my kids use it so much). So I was nervous about getting a new one, I did finally decide on the vidster (for xmas) because it had good reviews on the software. I haven't tried it yet since it is a gift.
Hope that helps.