The Sony RX-100 camera was rated the best point-and-shoot by the Wirecutter, and has outstanding Amazon reviews, including this one by a serious photo-geek named Phillip Greenspun. So I ordered it. I've been trying to find the perfect small camera that also takes great pictures. This one is pricey ($640) but I'm looking to have it replace my DSLR, and so far it's looking completely plausible. It has a Zeiss lens and takes great pictures in low light situations.
The key to great photography is knowing how to get the most out of your camera, and almost always that means ditching the standard manual and finding a book written by a professional photographer who uses the camera and can tell you the optimal set up, and most important features. The Sony RX-100 has a crappy manual; but I found a great book by Alexander White called Photographer's Guide to the Sony DSC-RX100 on Amazon. With that book on my Kindle I was able to figure out how to quickly set things up and how to quickly capture the pictures I want to take.
Here are some examples of flower pictures I took using the Macro setting (as he advised). And here are some Black & White photos taken with the street shooting set up he suggested using. Having the book helped me get out of my "DSLR mindset" and try new things that work well, but which I would never have tried—things I would never have had attempted (because I thought they were lame and amateurish) if I hadn't read a book by an accomplished photographer on how to use the Sony RX-100.
I love having a camera I can fit in my jeans pocket, and which I'm therefore inclined to have with me at all times. In that sense it's better than a DSLR, or even a Micro 4/3's camera, and definitely more versatile than an iPhone.