Best Canon digital SLR for sports photography
For sports photography, APS-C digital SLRs have the advantage of longer reach with the crop factor. For Canon 7D, 40D, 50D or Rebel XSi, T1i, the crop factor is 1.6. This means that 200mm lens will give 320mm in a 35mm camera.
Should you buy Nikon or Canon? Although Nikon lenses are of top quality. They are just so expensive that most people can not afford them, especially Nikon Sports lenses such as Nikon 300mm f/2.8 ($5120!). I think it is better to choose Canon since Canon lenses are generally more affordable than Nikon lenses.
The best Canon APS-C camera for sports photography is Canon 7D. Canon 7D has fast shooting speed (over 8 fps) than Canon Rebel XSi or T1i and even faster than Canon 5D Mark II (3.9 fps).
Compare Canon 7D prices (body only)
May be the most versatile and useful lens for both indoor and outdoor sports photography is Canon 70-200mm f/2.8 IS USM. Although IS is not really needed in sports photography. It is always nice to have IS as a walk around telephoto lens. You can also add a Canon EF 1.4x extender to get longer reach. The non IS version Canon 70-200mm f/2.8 is more affordable. A more affordable third party lens is Sigma 70-200mm f/2.8.
Canon offers instant rebates on Canon 50D and lenses until July 11, for details read Canon rebates. You can save $200 on Canon 70-200mm f/2.8 L IS USM!