Most of the rumors so far point to the fact that the Nexus 5 will be based off the LG G2 hardware, and besides having the same Snapdragon 800 processor, it also means that it could have the same 13MP camera, and something that gets me excited is using OIS (Optical Image Stabilization) for the camera, too, which the FCC filing seems to confirm.
OIS is such a great addition to smartphone cameras, that it's actually very disappointing to see any high-end smartphone without it these days. Some smartphones that launched this year, like the Galaxy S4 and Moto X are using EIS (Electronic Image Stabilization), but in S4's case it's so terrible it might not even exist, and in the Moto X is works great – actually better than all OIS-based phones right now.
The stabilization in the Moto X is almost perfect. The problem is EIS also seems to wash out the image quite a lot, and I don't think it's worth the trade-off. It also probably cuts off quite a bit from the resolution, too (to stabilize the "middle").
The OIS in the LG G2 is not perfect, but it's a huge improvement over no image stabilization, and it's one of the best around. Plus, the advantage of OIS is that it helps take much better pictures in low-light. It's also certainly much better than Apple's "solution" for the iPhone 5S, where it has to take 10 pictures in a row, every single time you're taking a picture, to choose the "best one". Taking a picture alone is quite battery consuming. Now imagine taking 10 in a row every time, and that fast. It seems obvious to me it's not a very efficient way to pick a better picture. OIS on the other hand can stabilize the image without so much power drain.
Vic Gundotra has been promising us "insanely great cameras" in the future Nexus devices, but I don't know if he was referring to something much better or something more like the G2 camera, which I think it's actually quite good. At the very least it seems better than the Galaxy S4 and HTC One cameras. It's not quite as bright as the HTC One, but close, and it beats both in everything else.
The 13MP resolution also seems to be a sweet spot between having a lot of detail and not making the camera too slow (a problem Xperia Z1 and Lumia 1020 seems to have), or not being able to take too bright pictures in the dark. Add OIS to that, and the Nexus 5 might finally have a decent camera for once, and that's something to be excited about.