To me, the best quality videos i've seen that were shot on a bike are those of mordeth13's. I therefore assume his camera is top notch. And it follows your sight, which is a big plus I think: proving you checked you blind spots, showing stuff to the viewer... You can use it for all kinds of things as well - but you need a helmet that can fit a pair of glasses.
It was badly effected by vibration... Can anyone recommend a decent camera that's easy to mount on the bike, is waterproof, not too expensive, and has reasonably good video quality?
Virtually any consumer camera will pick up even the slightest engine vibrations when mounted on the bike, resulting in almost unwatchable video, particularly on a single cylinder motorcycle. A camera which is mounted either on the riders helmet, or using a chest harness such as the one made by GoPro (about $40 USD), will give you much better picture quality as the camera is well isolated from the vibrations of the bikes engine.
As Jmia18 says, the GoPro Hero 2 cameras can be had for $200 USD, now that the Hero 3 is out and is marketed as the "latest & greatest" GoPro model.
I wouldn't be surprised if they drop the prices a little further in the near future, to move them off the shelves. I'm looking to get the Hero 2 myself, but I'm not in any hurry either.
My brother has the Hero 2, which he uses for off road enduro racing... he has some amazing looking video using the chest harness.
The Hero 3 White is £199.99 over here but it's $199.99 in the US with free shipping. That's £124.73. I think I'm going to buy one of those, get it shipped to my company's US office, and have it sent over here with the next load of parts.
He knows not where he's going, for the road it will decide, it's not the destination, but the glory of the ride.