hi jennifer,
in this case improving your technique will help more than a new lens.
looking at this pic (http://i133.photobucket.com/albums/q62/jynn10/layne.jpg), it appears that the hand is in focus,
not the eyes. shooting active kids is tricky because they move around so much. looks like you need a higher shutter
speed and/or a greater depth of field (bigger aperture number). if you shot this with matrix metering, you might also
want to use spot or CW metering and concentrate on the eyes. if they are in focus the rest of the pic will look
clearer, as the human eye naturally looks to the eyes of a subject in a photo first.
feel free to ignore arthur's suggestions that you need to purchase a $1200 or $1700 lens to get sharp pictures. he's
obviously trying to justify all the expensive stuff he bought, but he also seems to have overlooked your budgetary
requirements of $200.
the 50/1.8 would be perfect for you. the price/quality ratio is the best you can do, period. it will surpass your 18-135
optically at most apertures, but also allow you to achieve narrow depth of field by using larger apertures (smaller
f/stop numbers). this is what makes subjects 'pop' in photos where the subject is in crisp focus and the background
is out of focus, otherwise known as bokeh.
the 50 is great for portraits since it behaves like a 75mm lens on a DX sensor, but too long for walkaround use (for
which your 18-135 is better-suited). it's also way better in low light than a kit lens, which is great for no-flash, natural
light pics.
if you want detailed eyes, though, narrow DoF is not your friend. shooting at max aperture with the 50mm (f/1.8), it's
possible to get one eye in focus and one out of focus, depending on how close you are. that's when you want to stop
down to f/4 or 5.6, maybe even f/8.
the 50/1.8 works great on a d80 and makes the camera very inobtrusive, which is good for candids.
now, about that 18-135. while optically more complicated and therefore not as crisp as a fixed-focal length lens
(aka "prime"), you can still get good, crisp, detailed shots with it. i'd try using (A) perture priority mode, which allows
you to set the aperture while the camera controls the shutter speed. if you're in bright lighting, use a low ISO value;
indoors or in poor lighting, set Auto-ISO to 800 or 1250, which is about the max. on a d80 without significant noise.
generally, best results will be obtained by stopping down 2-3 clicks on ANY lens. so for a 5.6 max aperture at
135mm, you should stop down to f/11; at 18mm and 3.5 max aperture, you'll get better sharpness by stopping down
to f/7.1 or f/8.
of course, if you still have problems like a hand in focus instead of an eye, you might have to bump up the shutter
speed as well. starting in A mode is still a good idea, but pay attention to the speed the camera sets when you
review your shots in the LCD. now switch to (M)anual mode, dial in your desired aperture, and bump the shutter
speed one click. repeat until desired effects are achieved. you might also have to tweak the ISO unless you are in
Auto-ISO mode when increasing the shutter speed and/or decreasing the aperture.
as far as a better zoom, i'd suggest something with a constant 2.8 aperture; anything else will be only a marginal
improvement on your 18-135. i personally like the tamron 17-50 and 28-75, which give excellent bang for the buck,
but both are way out of your current budget at around $400/$350, respectively.
you might want to see if amazon still has the sigma 24-60/2.8 for around $200. while probably not as good as the
$1700 24-70 arthur got so lathered up about, you dont need a lens that was designed for use on a $5,000 camera
(the D3); the 24-60 should work great on a D80.
one last suggestion: get "understanding exposure" by bryan peterson if you havent already. it's a great learning tool
which will allow you to take better pictures without emptying your wallet on new gear, which is useless if you dont
know how to use it properly anyway.