I've heard some good reports about the Hewlett Packard DeskJet 990Cxi - its about £180-£200 depending on where you buy it from. Its more of an all-rounder printer, good at photos, but very good at everything else.
If you want a photo only printer, or a specialied one, try the Canon CP10 Photo Printer (photos only) or the Hewlett Packard PhotoSmart P1115.