What's new / changed

8.0 megapixel CMOS sensor
Not exactly unexpected but what is surprising is that Canon has developed a new sensor for the EOS 350D. This one has 8.0 million effective pixels, compared to the EOS 20D's 8.2 million. This sensor is 'second generation' (the EOS 300D's was considered first generation) which is the same as the rest of the sensors in the current digital SLR range.

Near instant power on time
I'm glad to report that the startup time improvement we saw on the EOS 20D has made its way to the EOS 350D (and it had to really looking at the D70). The EOS 350D takes a shot within about 0.2 seconds of switching on, the EOS 300D took around 3.0 seconds.

3 fps continuous, 14 frames
Up from 2.5 fps and a maximum of 4 frames the EOS 350D can shoot continuously at 3 fps for up to 14 JPEG frames or 5 RAW frames. In reality with a fast CF card you can normally squeeze a few more shots out than this.

DIGIC II processor
The DIGIC II processor first seen in the EOS-1D Mark II now features in the EOS 350D. According to Canon this improves image quality, means lower noise, fast processing, faster write speeds, better buffer usage and lower power consumption.

The EOS 350D is 15 x 5 x 8 mm smaller, might not sound like much but it looks much smaller and in your hand feels more compact.
Without a lens but with its battery and a CF card the EOS 350D is 110 g (3.9 oz) lighter than the EOS 300D, 36 g (1.3 oz) of which is thanks to the use of the smaller NB-2LH battery.
Black body color standard
From what we understand black will be the 'standard' color for the EOS 350D and a silver version will be made available in certain regions and/or stores.
Re-designed control layout
The drive mode button has moved from the top of the camera to the rear, the CF indicator has moved closer to the LCD monitor and the left / right arrows of the 4-way controller can now be used to select metering and AF modes.
Re-designed LCD panel
Because of the addition of direct control of AF mode, metering mode and flash exposure compensation the EOS 350D needed a new status LCD panel.
Higher pop-up flash
Although it's difficult to see from this image the EOS 350D's flash is slightly (just 5 mm) higher than that of the 300D, whether this would make any significant difference is another question. The flash system now uses E-TTL II metering.
Custom Functions / SET button
The EOS 300D had no custom functions and this limited its flexibility considerably, this has been redressed (at least partially) with the inclusion of nine custom functions on the EOS 350D. Custom function 01 allows you to customize the function of the SET button / 4-way controller.
Selectable exposure increments
Custom function 06 allows you to select between 0.3 or 0.5 EV exposure increments, this applies to compensation, bracketing and exposure selection (shutter speed / aperture). A full breakdown of all custom functions can be found later in this preview.
Selectable metering mode
The EOS 350D now allows you to select metering mode (although in certain shooting modes it will be locked).
Selectable AF mode
The EOS 350D now allows you to select AF mode, on the 300D AF mode was locked to AI Focus in the creative exposure modes (P, Tv, AV & M).
Flash exposure compensation
Perhaps the biggest hang-up of our EOS 300D forum and one of the first features 'released' by the firmware hackers Canon has decided to include flash exposure compensation (FEC) on the EOS 350D (as it should be).
Independently selectable color space
As per the EOS 20D color space has now been split away from parameters which means you can now combine parameter adjustments with Adobe RGB color space.

Modified parameter sets
As per the EOS 20D there are two preset parameter sets, the default being Parameter 1 which has a higher contrast, saturation and sharpness than the default, Parameter 2 has neutral settings, after this there are three customizable parameter sets.

Black & White mode
Also new is an in-camera black and white mode with digital color filters which work in the same way as a color filter would on black and white film. Additionally you can also apply a 'tone' to the black and white image (sepia etc.)
New WB shift / WB bracketing screen
The EOS 350D's white balance shift now provides shift in two axes; Blue to Amber and Magenta to Green. WB shift is achieved on this new screen using the new joystick controller and you can add bracketing by simply turning the quick control dial.
RAW + JPEG support
While the EOS 300D claimed RAW+JPEG support, in reality only provided a JPEG embedded into the RAW file. The EOS 350D now has 'proper' RAW + JPEG and in this mode writes one RAW (.CR2) and one Large/Fine JPEG (.JPG) file for each frame taken.
Record review histogram via INFO button
On the EOS 300D you chose the record review display mode from a menu option, on the EOS 350D you simply press the INFO button during record review to change the display mode for all subsequent record review displays.
Jump by shot date, 10 or 100 images
The play 'Jump' feature can now be used to jump by shot date, 10 or 100 images. The new shot date option is especially useful for skipping an entire days worth of images.
NB-2LH battery
The NB-2LH Lithium-Ion battery is the same used in the S60 / S70 it's approximately 50% the weight of the 300D's battery and provides 65% the capacity (7.4V, 720 mAh).
New BG-E3 battery grip
Because of its yet smaller dimensions the EOS 350D gets a new battery grip. The BG-E3 supports two Lithium-ion battery packs or six AA batteries (using a supplied battery magazine).
USB 2.0 Hi-speed connectivity
Direct USB transfer of images from the EOS 350D are now a much more viable option thanks to the introduction of Hi-speed USB 2.0 interface. We achieved transfers of just over 2.6 MB/sec.
New software bundle
The 350D will include ZoomBrowser 5.1 (with EOS capture and improved RAW processing features) as well as Digital Photo Professional 1.6 (DPP) and PhotoStitch.
Additional language support
The EOS 350D now supports fifteen menu languages including Korean and Russian (new).
Re-designed kit lens
The EOS 350D's EF-S 18-55 mm 'Kit Lens' now carries the 'II' suffix indicating a re-design. Canon inform us that the changes are purely cosmetic and that the lens elements are identical. Note that this lens still isn't USM where as the black EOS 300D kit was sold with a USM lens (as was the original EOS 300D in Japan).