You are right concerning the editing software included with most cameras. It is usually pretty basic allowing you to do only a few things. Some cameras and scanners have older versions of Photoshop Elements included as part of the bundle.
Photoshop, either the full-scale pro version CS3 or Elements, is the most widely used and supported photo editing software out there. Elements is reasonably priced at about $99 or so. The full-scale pro version is usually around $600!
There are others out there as well. Before taking the plunge maybe buy a few digital photo magazines and read about the different choices. The magazines are certainly cheaper than buying a piece of software that you may not like.