ISO 1600 and that many dollars on the table
Life begins at base ISO
Don't pay attention to the conventional 'wisdom' regarding compact cameras You would think, reading in the blogosphere, that small sensor cameras are useless, require a diminution in your photographic standards, or require some different conception of how your pictures are rendered. That's nonsense. Better small sensor cameras, shot at their base ISOs, return suprisingly close quality to DSLRs of the same megapixel count shot at base ISO. If your major mode of shooting is in broad daylight and your depth of field requirements can accommodate the base ISO (usually 80-200), a DSLR might be largely deadweight compared to a small camera of equivalent resolution. Likewise, if you are indoors and using flash at relatively close ranges, you can go back to base ISO on a compact and blast away. Sometimes the function of a camera is to be there, to stay out of the way, and to get the shot. So don't count the small ones out immediately.
Where DSLRs pull ahead is in noise. Anything pushed above base ISO starts getting noisy, and the smaller the pixels, the faster it happens. It's just the threshold of pain. And so people who grew up shooting film are used to ISO 400 being a little grainy - and they are the ones with a higher tolerance for the increased noise of compacts. And the expensive DSLRs tend to be a touch more responsive in shooting speed than compacts. By 'a touch,' I mean 'a lot.'
My practical - and shocking - introduction to the utility of compacts was in Africa a couple of years ago. I took a D2x ($4,499) and a traveling companion took a Sony DSC-T5 ($225). Although you would never be shooting pictures of zebras with the tiny, flat Sony, in any situation involving humans, the T5 pictures left little to be desired. Its built-in flash was good at fixing backlighting of people in a way that the Nikon could not (at least not without an SB-800). And when you consider that at least half the output (the non-stand-out pictures) went to 4x6" (10x15cm) prints, there was no difference that would have justified a price tag twenty times the size. More recently, I took a Leica D-Lux 3 to Brazil and noted that it was very, very good. Not quite a Hexar with medium-contrast color negative film, but pretty good.
Chasing the photographic dragon
In the late 1980s through the mid-1990s, the Japanese photo industry had a little bit too much money. This, one could surmise, led to its unleashing a large number of niche film cameras. These ran from the eminently practical (Konica Hexar) to the stylish (Olympus O-Product) to the tiny (Kyocera Contax T) to the wide (Ricoh GR21). At the same time, it seemed that everyone was releasing Leica thread mount lenses: Konica, Minolta, Ricoh, and Pentax. It seems that these product developments, which had no identifiable commercial viability, were driven by the nostalgia of older camera engineers who did these projects on their way from working the drawing boards to window watching. One of the cameras that came out of this era was the Ricoh GR-1, a cult 35mm film camera with a fixed 28mm lens and an ultrathin body. This became the model for the GR Digital line. The GR Digital II discussed here is the second member of that product family. For purposes of this article, I will sometimes discuss its features in comparison to the Konica Hexar AF, a good reference as a supremely functional camera. From time to time, I will also refer to the specifications or features of the Leica D-Lux 3 or the Sigma DP-1, which currently are the only two other current subcompact cameras that can shoot RAW files.
Size, Ergonomics, and Construction
This camera is small enough that you could probably fit it inside a box of Mild Seven cigarettes with room to spare. It is much thinner front-to-back, especially when closed, than the DP-1 and the D-Lux 3. Most of the construction (at least externally) is crinkle-finish alloy. The popup flash is plastic, the buttons and dials are plastic, and the tripod socket is metal. The controls are intelligently laid out and can be customized to a high degree. Nothing at all to complain about. This camera is made in China, which is somewhat surprising since it costs more than the D-Lux 3, which is made in Japan.
Optics
The GRDII has a 6-element, 5-group lens. It has a focal length of 5.9mm, which on the 1/1.75" size of the sensor is equivalent to a 28mm lens. If the camera is shot in 3:2 mode, it's more like a 30mm lens. And in 1:1 mode, it's about 32mm. The angle of view on this camera is a little wide for normal use; a 3:2 mode equivalent to a 35mm lens on a 35mm camera would be a little more practical. So in practical terms, the lens will be a bit wide for general use (watch that the camera is level to prevent keystoning), but you can always crop a little bit in post. Or get closer. Or just learn to deal with it. Where was life before zoom lenses?
The maximum aperture of f/2.4 is very fast for a compact, about 1.5 stops faster than the new Sigma DP-1 and at least a stop faster than the D-Lux. Advantage? Focusing speed and just about nothing else. Maximum aperture ends up being something of a wash because the DP-1 (at least from what I have seen) gets twice the ISO before you start seeing noise. And the Leica makes up part of the difference with its excellent Panasonic-engineered Mega OIS optical stabilization system.
The one thing, though, is that if you find base ISO tolerable on a compact camera, the apparent depth of field is amazing - meaning that you can shoot at much wider apertures than you could normally.
Like every other subcompact that can shoot RAW, the lens pops out of the body when you turn the camera on. This is annoying, but it is probably a compromise required by trying to pack a retrofocus lens into a 1" thick body. Folded optic zoom cameras (like the Sony DSC-T5) are more durable but pay the price in lens speed. Plus nothing with a folded optic system currently does RAW format.
Focusing/Basic Performance
Focusing is via passive autofocus and takes between half a second and a second (if you don't use the AF assist light in dark scenes). It seems slightly faster than other cameras in its size range (apparently, that extra lens speed helps). It also makes faint clicking noises when the lens makes its final snap into focus. Focusing can be by general area or spot. It is passable in very low light. There is an optional green LED focus-assist light, but your human subjects may need a retina transplant later. It would really be nice to see active AF replace passive on compact cameras, but this may require more manufacturing precision than would be cost effective on a digital camera. My surmise is that passive AF is a closed-loop system that makes its own corrections for manufacturing tolerances.
The GRDII focusing system can be also set for manual focus or 'snap' focus, where the lens sets itself for a hyperfocal distance based on the aperture selected. In these modes, you get a bar graph showing the focusing range and what range will be in focus. A good way to shoot this camera is in snap mode with an external viewfinder. This is somewhat more advanced than the system in the Konica Hexar, which allows the camera to be toggled between AF, a single user-set distance (remembered by the camera) and "hard" infinity. The Hexar requires you to remember to set the hyperfocal aperture to get what you would call 'snap' focus on the GRDII.
The lens is good, very good. On my copy of this camera, sharpness seems to peak around f/2.8-4, and it looks like diffraction starts sending things downhill at f/6.3. It's easy to overlook the potential of fixed focal length digital compacts until you use one of these. Between the greater apparent depth of field and corner-to-corner sharpness, GRDII pictures, particularly landscapes, look like they are laser-engraved. There were not any noticeable variations between the left and right sides of the frame. The lens has amazingly low distortion. Having a single focal length forces discipline in framing. Having massive depth of field should make you pay more attention to composition. Consider that much of the time, the "isolation" people seek from fast SLR lenses is really a dodge against what is or is not sitting behind the subject.
Files
The GRDII generates RAW (or more accurately, Adobe DNG) files such that 120 pictures taken in 3:2 (9mp) mode will fit on a 2Gb Secure Digital card. About 116 will fit in 4:3 mode. If you shoot in DNG, you will always get an equivalent-sized JPG file (you need this to be able to see the shot in playback mode). The JPG file will reflect the image correction settings you selected on the camera, so if you selected black-and-white, the JPG will be in black and white but the DNG will still come up in color when you edit it in Photoshop or Lightroom.
GRDII raw files put about equal emphasis on shadows and highlights, meaning that you will not get the exquisite shadow separation of a Leica M8, but you will stand a better chance of recovering blown highlights.
The camera has a RAW buffer that can write one file at the same time the camera takes the next picture. This camera does not have a continuous mode and does not pose much danger of overrunning the buffer.
Controls
The camera has fairly straightforward controls, and you can reprogram just about anything. The main controls are a mode selector on the top (M, A, P, "easy," MY1, MY2, and Scene), the shutter button, a control wheel in front of the shutter button (like on a DSLR), a rear horizontal rocker, a rear vertical rocker, a five-key keypad, play button, a self-timer, and a display button. The genius of this camera is that you can program very nearly any control you want as a no-menu option. For example, the up-down rocker serves as an excellent exposure-compensation selector.
The camera can remember three complete groups of settings (MY1, MY2, and whatever the camera is set to when it is not on a MY setting).
One really useful control is the ability to turn on a built-in digital level that can either show with a graph or beep when the camera is level around the lens axis. There is no feature, however, that would tell you if the front of the camera is pointed down or up; you need to use the gridlines for that.
One really offbeat control is selected by turning the main selector to "Scene." The camera has an automatic keystone corrector that finds a skewed oblong object in the scene and generates a corrected JPG that is de-keystoned and cropped to the size of the object. My surmise is that this is designed for taking pictures of artwork at museums.
Screen
The viewscreen has five modes during shooting: off, full information (including the level), full information plus histogram, grid, no information. These are toggled by the screen button. During playback, the viewscreen has several modes: full size, full size with highlight blowout flashing, exposure info, more exposure info plus histogram. You can view pictures in three sizes: full size modes as above, thumbnail, and thumbnail-medium size-thumbnail. Response time is good, and the screen provides a decent guide to what the finished shot will show.
Miscellany
The camera has some interesting accessory possibilities.
First, you can get the adapter and hood combination. The adapter bayonets onto the camera and provides a rigid lens barrel with a 37mm filter mount. The rectangular hood then bayonets to the adapter.
Second, Ricoh makes converters to change the angle of the lens to correspond to 21mm or 40mm. These utilize the adapter above. The 21mm supplemental lens is huge. The 40mm is smaller. Ricoh's supplementary lenses are big, good, and expensive. If you just want to experiment, you can use 37mm video-oriented lenses (0.5, 0.7 or 2.0x), but they won't cover the sensor (video sensors are smaller). These cheap supplemental lenses arem however, usable as a novelty if you shoot in 1:1 format.
Third, you can add an accessory finder. Ricoh sells accessory finders to match its supplemental lenses. It also sells accessory finders for the 28mm field of view. There is nothing to stop you from using your favorite accessory finder. My two favorites are the Leica Frankenfinder (Universal Viewfinder M) and the 65mm finder for the Mamiya Super 23 camera. Both are huge and have parallax correction; the former has a built-in bullseye level and the latter has a massive unobstructed view.
Finally, you can use a flash. The only currently available external flashes that are billed as working with this camera are the Sigma EF-530 and EF-500 DG ST/Super, a pair of monstrously large (and fairly expensive) external units that are dedicated to Sigma SLRs. I guess no one else would license Ricoh a D-TTL-style flash system? You need to update the firmware to the latest version to make sure these will work (the 12/2007 firmware did not handle these flashes). I haven't tried either. The EF-140 DG flash (made for the Sigma DP-1) may also work, although it is very, very basic. I would not hold my breath – because the revision history for the GRDII firmware seems to suggest that each model of Sigma flash must be separately addressed by firmware (the EF-500 was first, the EF-530 was next). Note that the dedicated flash contacts on this camera follow the Sigma pattern, meaning that you cannot use a Nikon SC-17 to take an external flash off-camera. You would have to use a Sigma-specific off-camera cord. You can also use any basic automatic, low-voltage-sync, standard hot shoe flash with this camera, although the exposure integration will not be nearly as tight.
The DP-1 Question
The answer is, "not yet."
Conclusion
If you cannot live with a fixed, fairly wide lens, do not buy this camera. If you have a psychological hangup about small sensors, but do not care about response time, proceed directly to the DP-1. If you need a zoom lens, purchase a D-Lux 3. If you have not been scared off, buy the GRDII and use it until a higher-featured version of the DP-1 comes out. Then revisit the issue.