I had a 1050Z, and loved it. Unfortunately, due to my own error, it flooded the last day of the trip I had it on.
After using the Canon, Oly and Casio UI's, I prefer the Casio. The movie mode did quite nicely, and I thought the lens/sensor did well as well.
There is no priority mode or RAW mode, and no hotshoe. That said, the enclosure is small and I even made decent use of the flash underwater.
Shutter lag is minimal, the screen is big and bright, it saves shots quickly and can do interesting things like a series of quick shots at lower resolution. I actually liked the tracking autofocus, it worked well for me.
Macro mode wasn't as terrific as I would like, but that was likely my own failings- first dives with a camera, and not as much above water experience as many. By the end of the trip, I really wanted to play with aperature priority, but found ways of messing with ISO and EV's to try and push it to do what I wanted.
I didn't see much noise up to ISO 400, and the camera does support super-high ISO. Overall I was very happy. A camera that I could dive and not fight with, and one that I could clip out of the way when I didn't want to think about it.
I never dove it up here, just in warm water, so I don't know how well it does in the constant lower-light conditions, etc. That said, the video of the sixgill from a 1000 was what sold me that I had to have a camera to dive with!
I have some photos taken with the camera at
http://gallery.faucet.net/Belize-2007.
The 1200 looks very similar, I'm pretty sure I don't need the extra megapixels. It does however have aperature and shutter priority modes, although I hear they aren't quite what I would like. It also shoots quicktime rather than AVI which is a disappointment for me.
I suspect I will hold out for the 1050's to drop in price some more (I have a perfectly good housing after all) and get another one. Then I might get an Oly 410 or such and choose accordingly.
In summary, if you want a small point-and-shoot with decent features, low fighting-it-under-water factor and good quality (for a p+s), I recommend the casio 1050 wholeheartedly.