How do "optical" and "electronic" stabilizers differ?
An optical stabilisation system is really two pieces of glass held together with an accordion-style bellows. When the camcorder senses any kind of vibration it flexes that bellows to bend the light through this optically pure liquid that's in between them, so it always hits the chip nice and even. The biggest advantage to that is that there's no loss in picture quality; there's no loss in resolution when you're engaging an optical stabilisation system. However, a lot of camcorders (especially in the lower price range) have an electronic stabilisation system. That electronic stabilisation system stabilises the image by moving it around on the chip. So, if the camera starts to vibrate it changes where that information on the chip comes from. If this was your chip, and you wanted to stabilise electronically, as you move the image on the chip moves with it. It does a pretty good job these days, but it will cost you a little bit in resolution when electronic stabilisation is on. Optical: still better, but electronic is working pretty well these days.