Megapixels matter when you want to print large prints. Can also be useful if you want to do some major cropping.
Read this http://www.digital-photo-secrets.com...photo-quality/
If you only enjoy your photos on your computer screen, or uploading to a photo website to share with friends, you really only need a 1 megapixel camera. That is because your computer monitor is usually about 1000×1000 pixels = 1 megapixel!