Thanks Dante. I have been out to a store to check out both cameras, and I liked the smaller feel of the cameras. My hands aren't very big, so the small size isn't be much of a problem.

I was leaning towards the 17-85 because of the crop factor. That would give me a larger range of wide angle to telephoto than the 28-135. And everything I've heard about the 50mm says its a great value lens

EDIT: I am currently favoring the XT slightly because of the fact that I will probably upgrade in 2-3 years anyway and it will take me that long to master all the stuff on any digital SLR. Also, I will likely be ticked off when the inevitable Digital Rebel XT plus/extra/super edition comes out in 6 months to a year because I didn't wait the extra two months and pay more for the XTi!