I wasn't aware it was 'better'. A lot of the features from the d80 were ported back to the d40.

The LCD is better on the 40, and its a touch bigger, and it has the processing straight from the d80 as well.

the d50 is a tad bigger (which I'd prefer) and a bit better control layout, and the d40 doesn't have an internal motor so you can only autofocus with a few lenses, not nearly as many as the d50 - those are the only drawbacks imo.