I'm thinking of getting another camera (what would be my 4th digital camera). I've had my Olympus E-1 for just shy of ten years now but it's still going strong; I love using it and it takes fantastic photographs (much nicer than my much newer Canon point-and-shoot). The downside is that, with the standard 14-54 zoom, it weighs over 1.2kg and is pretty chunky; it's a lot to cart around while travelling with a child. (Though maybe easier now she's walking?)
The camera I'm thinking about getting is an Olympus E-M5 with a 12-50 lens. This combo isn't going to fit in my pocket like the Canon P&S, but it weighs half as much as the E-1 with 14-54 and is distinctly smaller. (It also has a pile of other features, of which only a few are likely to matter to me: a wider lens, anti-shake and ridiculously high ISO for low light, and a tilting screen for low level macros.)
The downside is that I can't see myself ever getting rid of the E-1, so this would just be "more stuff"...
I know that at this point today, you can't see yourself getting rid of the e-1. However, I have a feeling that with the e-m5 you'll either find a camera to replace tasks currently carried out by your e-1, or it will not perform as well as your e-1 and you should get rid of the e-m5 in that case.
In other words, don't think of this as adding an extra camera to your collection, as much as auditioning for a replacement e-1 that is half the weight and smaller.
As for the e-1: I tend to go in two directions with this.
1) sentimental value only, so evaluate in accordance with sentimental value policy.
2) collectible, so evaluate in accordance with collectible policy.
I say go for it. The OM-D EM-5 is an excellent camera. I've only heard good things about it. As for the new features, you'll get used to them and take advantage of them. Digital camera have come a long long way in 10 years. Somethings you can't read in the spec sheet. Like dynamic range. Modern
camera have much better dynamic range. Auto focus is way faster now. And high ISO are amazing. Plenty of lens out there for the micro 4/3 system. Alot of non-OEM brands like Sigma, etc. As for the good-old E-1. Hang onto it and give it to Helen so she can learn photography, or sell it on EBAY. Plenty of taker out there for a working E-1.
Make sure you try one at a camera store. The grip is small, and the screen takes up most of the rear, not leaving much space on the right for the bottoms. The EM-5 was released 2 years ago, so prices should be very reasonable. Since then, Olympus has released a EM-10 and EM-1 versions.
Good luck.
An opportunity cost calculation. ($1000 + !E-1 in the cupboard) - (carrying 600g extra * number of times you want to take better quality pictures than the pocket camera)) * the life expectancy of the E-1.
With depreciation the E-1 is worth about zero after 10 years of use and travelling. The real hassle comes when you have a lot of lens and accessories for the old camera that don't work with the new one, so you have to forego them or replace them.
Personally I'd rather a light, long battery life camera with 5x optical zoom, lots of MP allowing oversampling in low light or digital zoom that I can throw in a backpack or panier. The price doesn't seem to fall though because of the Australia tax, falling dollar and them always cramming more unwanted features in (why would I want to waste battery life stamping photos taken in Sydney with GPS co-ordinates -- I know where Sydney is!).
This is one (unusual) case where the camera is much cheaper in Australia ($850 with the lens) than elsewhere (around £750 here, or US$1100 in the States).
A camera GPS will tell you which suburb or even street you're in, not just which city. But they do chew up battery life, yes, and I'm not sure how much I'd actually use one.