My wife just went through changing her hosting provider. We had heard so many stories about botched transfers that we transfered her domain name to godaddy first, then after that was complete, we moved her DNS to her new provider.

I think godaddy is a good deal. Yeah, your hosting provider may provide regiatration too, but the hassle of not having to change it justifies spending the extra $8/yr on registering someplace insependant of your hostinf provider...