Yep, Dazza pretty much covers it. The 55-200 is supposed to be rather good, so if your budget is circa £125, go for it. If you intend to shoot wildlife though, the 70-300VR is obviously longer, and even better, so might be a better long term investment.
I'd get the 55-200mm VR you mention and maybe look to add the nikkor 50mm 1.8 (about £70) if you want to do more portrait photography. Landscape well those lenses don't come cheap, looking at about £280 I believe for the sigma 10-20mm which a few of us have on the forum but your 18-70 won't do a bad job in the meantime.
That's handheld, I'm pretty pleased with it!
The pic is as it appears really, I've auto-brightened it a bit. The Sigma (HSM version for auto-focus on the Nikon) is £150 in Jessops but was recently £99 and I got it for £89 when I bought my D40,