It could be worthwhile to invest in something better. One possibility could be the Panasonic TS4. Not cheap at $300, but that is less than it was earlier this year. A good precaution with any underwater camera could be to get the Hoodman Raw Steel SDHC card. If the camera leaks, at least you pictures could survive. Also add an Olympus or Pentax floating wrist strap.
I have a TS3, and I have not really used it a lot. For video the autofocus seems to hunt a lot in my few experiments. The sound picks up wind noise a LOT, but other than that it is decent. The lens and the microphone drain quickly after immersion, so it makes the transition from water to back to air very well. Here are a few examples.
http://www.youtube.com/watch?v=5mkFLlbtiN8
http://www.youtube.com/watch?v=hUelElPFt_0
A camera preparation I make for cold water is to put it into a sealed sandwich bag for a few days with a silica gel pack and the battery/card door open. Then I close and lock the door before opening the bag. This reduces the risk of condensation fogging the lens.
This is a test I just did today:
http://www.youtube.com/watch?v=o3TipTTHKYM
I discovered that there is severe blooming of the sun in the background. There was good recovery of the audio after immersion, which is a priority for my intended use.
The demonstration videos that I have seen for the GoPro Hero show really gorgeous video. I have seen the sun in the background with no blooming problem. Every underwater demo I have seen has overlaid music, which seems consistent with reviews I have read that its actual sound recording is awful with the underwater housing.