Well, I have a 40D. (I lost the 350 body in an unfortunate way.)
I can only say that I like it a lot. So much that it can make me "forget" my OM. (yes, me too...)
Forget...no. Rather, I don't miss it anymore.

I did not get a kit. I only got the body as I already had my lenses.

18 to 85 makes, in OM speak about 28 to 155. This should cover most of your basic needs I guess. Because you can crop a lot - you only need 1000x800pixels for a decent 5x4inch- your "tele" or "macro" options are in fact much longer/closer.

The 40D has 14bit raw. This means that if you want to shoot raw, you won't be able to use Photoshop's raw conversion nless you have CS3. (I don't). The soft that comes with the camera is quite good.

So if you want to invest the money, you won't be disappointed. Unless of course the exception to the rule that something should be wrong from the start, but that's what an express warranty is for.

There are no Borg. All resistance is fertile.