Having owned a NEX-5 with both the pancake and the 18-55mm lens for a few months now I can say that I have been very impressed with it.
Main reason for buying the NEX rather than a DSLR was that I didn't want a huge camera - I also hate having to use view finders and find it much simpler to frame a picture on the LCD
Handling wise - the camera feels fine even with the 18-55mm lens plus a fisheye attachment, although I'm not used to how a DLSR handles either.
With the pancake lens fitted, the camera is small enough to slip into a jacket pocket, although I tend to just leave the 18-55mm lens on
I've used the flash once just to check it works. The camera has great low light level capabilities and I've never felt the need to use the flash even at parties (or which there have been several recently!)
There are plently of manual modes, and although the menu can be a bit of a pain it does at least remember where you were last so switching frequently between manual and auto focus isn't too painful. (There has been a software update which I can't remember being mentioned in the article)
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