It's perhaps worth noting that the main quality advantage of an SLR over a good compact is determined by lenses and that this class of lens is not one that will give you a noticeable improvement. I would recommend something like Canon's 28-135 over this, or, even better, a 50mm f/1.8 (best value) or f/1.4. Sure it's fixed focal length, but you will get really sharp images that make it worth the trouble of carrying an SLR. A greater focal length range is not necessarily an advantage. A 50mm lens may not 'cover' every situation, but the shots you get with it will not be limited by the lens and it's one you won't grow out of. Most of the great photojournalism of the 20th century was shot with fixed short focal length lenses.
The 40D is a great little camera and it will produce outstanding results with good glass. A simple lens to start with will help you to hone your skills much better than a super-zoom because it will force you to put your attention toward the image rather than the equipment. It will reward your diligence much more too!