Most seem to, as a basic rule of thumb, avoid digital zoom. If you have the option of using optical zoom, where your CCD is actually capturing more of the desired picture, you do not have to rely on some algorithm to interpolate what pixils it thinks should be in your picture.
Again, the quality of the digital zoom will vary from camera to camera based on the quality of the firmware (camera's software), just as the effectiveness of optical zoom depends on the quality of the lens.
If you have the option of getting a camera with a decent amount of optical zoom, it will allow for more possibilities as far as editing your pictures later and more than likely any prints you make will look much nicer.
-Brad