The difference is pretty much the same as with a digital camera. It is mainly about resolution. The pricer models have a much higher resolution (or pixels) thus giving the user a much higher quality picture.

The cheapo models generally give you a look that is *grainy*; it is not clear by any means and they also have a lot of *lag* time it seems to me. Like if you are using a chat program such as MIRC for example - the *channels* are bogged down - thus creating lag time (or the time it takes from typing to appear on the screen)

If you want or need a really good live picture; you can't spend too much money; you will get what you pay for in this department that is for sure.