Unfortunately, the world of P & S will always be plagued by inefficiency in low-light situations. That is inevitable no matter which P & S you get.
The tyrany of a small sensor, yup.
Sure, some claim to be better than others but at the end of the day, the difference is in the algorithms that the camera is using to determine shutter speeds, apertures, whether or not the flash fires, etc.
If we take a step back into the fundimentals, we should recognize what "blur" is: it is a shutter speed that was slow enough to display the camera's movement on the final image.
With this in mind, we realize what we can do, some of which are within the "Auto" mode limitations and some that are not:
Option 1: get rid of the camera shake.
Does this mean finding a camera with Image Stabilization (IS) electronics? Not necessarily! This is also is as simple as "Silly, don't shake the camera!", which can mean to use a tripod ... or an improvised tripod ... to prevent the camera from moving as much.
For example, no tripods were used in the following shots with a P&S:
These photos were taken with my P&S held (pushed) against some common object found along a city street, such as a lamp post, wall, railing, mailbox, etc. Don't even worry if the picture is slightly crooked, because that's a very easy fix in post-processing.
Option 2: use the camera's built-in flash.
Obviously, this is more appropriate for close shots, where it will functionally freeze the foreground. But what's less obvious is that for longer distances, the flash is probably only going to mess things up and on "Auto" it will affect what settings that the camera *thinks* it wants, so you'll want to override it to turn it off sometimes too.
Option 3: muck around with other camera controls.
3A: f/stop.
However, most Auto settings will have already done this
3B: higher ISO setting.
Trade-off here is higher ISO = more gain = more noise in the image.
This is getting a bit more advanced, but you do need to plan ahead by choosing a P&S that offers a manual mode so that you have this option.
FWIW, I find using a P&S's manual mode to be quite useful. What's also nice about this is that it doesn't mess around with the AUTO settings, so I can throw the camera into Auto for a flash snapshot of someone I'm with, then spin the dial to "M" and prop it against a street light for a night landscape shot.
Option 4: choosing your equipment wisely.
The general rule of thumb is that a digital camera will have less noise at higher ISO's if its sensor's pixels are larger
(which helps you use those higher ISO settings). I've found it to be generally difficult to find out what size CCD a particular camera has, and then even if you do find it, its description will be something like (1/1.8") which is confusingly counterintuitive. However, a decent (but not foolproof) measuring stick is simply the number of advertised megapixels - - in this case, for better low light and night shooting with a P&S,
lower is better. For example, the P&S used in the above is an old Canon Powershot A80, which is only 4 megapixels.
Option 5: Stabilized postures & marksmanship techniques.
Shooting a photo is a lot like shooting a gun in that your "aim" is steadier if you know what you're doing. You can choose to use a more supported position to reduce shake. For example, holding the camera close to you with two hands, instead of on one hand far away. Similarly, using the optical viewfinder (forehead becomes a third support point), and increasing your body's stability by lean yourself up against a wall. Similarly, learn the relaxation and breathing techniques used in marksmanship training to reduce your heatbeat and lung heaving...and then slowly squuuueeeezzze instead of jabbing at the shutter.
Option 6: Try, Delete, Try.
Since its digital, if the picture doesn't immediately look decent, delete, change a setting and try again. If you get a blurry shot, try taking a few more to see if you get a good one. Its not cheating
-hh