I have an XTi with an 18-200mm IS lens. Works great, no issues. I wanted a smaller dSLR and a versitile lens I could take on trips. I didn't want to carry around a heap of gear if I could avoid it.
The Nikon equivalent to the XTi is the D80. We bought a D80 at the last company I was at and it worked well too. The XTi camera body is smaller than the Nikon D80 which is good for some not for others. As MLK says it depends on your hand size.
Canon vs Nikon is sort of a coke vs pepsi conversation. Both give you caffeine, depends on which one tastes better to you.
You could also look at Pentax, they make solid cameras which are very often overlooked. Lots of lenses for them too.
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