Here we go, hopefully a final post from me in this thread, and a recommendation of a great low cost webcam that works OOTB in 9.10 without any of the fiddling that was needed for my digital camera to be used as webcam.
I have just bought a Logitech C120 webcam (£9.99 from many sources in UK), plugged it into the usb socket and ran skype with the simple command "skype", rather than the shell script noted earlier to run it, and it all works brilliantly. Great little webcam, and recommended for use with ubuntu.
Linux Ubuntu 9.10 32-bit
2gb ram ddr3
Intel(R)Pentium(R) Dual CPU E2200 2.2Ghz