Wow, I wasn't expecting so many replies!
Thank you to everyone who has taken time to ponder my dilemma and offer their thoughts and opinions.
There's no clear winner at present, so I'm still pondering on it myself.
Whilst my wife is fully involved in the decision, that doesn't help much as she doesn't really know herself what she wants. I'm inclined to agree though that a second-hand camera is not much of a gift, especially as I've now spotted some rust on the neck strap lugs
Regarding the pop-up flash, I've checked and sure enough the 10D does have a pop-up flash. I've either never used it/ realised it was there or the camera has been in the cupboard for so long that I just forgot. Unfortunately though, I've tried it out with the 24-105L lens attached and the pop-up flash is pretty useless as the lens is too long physically and casts a shadow on the image! I could buy a smaller lens for the 10D, but then for similar price I could buy a new body/lens kit. For various reasons then, I think we can rule out the 10D.
Opinions offered vary widely, but I'm beginning to err towards a compact with a decent sensor, the problem being that all of them have pros and cons so it's really difficult to choose!
I have a headache just considering all the options