Many of the reviews of C5050-Z have noted the camera sharpens its images more than other cameras. I'd agree the C5050-Z does seem to have more sharpening, and thus, more noise in its images than did my previous C-series Olympus cameras. Fortuantely, the C5050-Z has a setting to allow less or greater sharpening.
After some testing, I found I prefer a setting of "-2" for my images. You might like the same setting or want something entirely different. Do some testing and see what your preference is. I thought I'd post my test files to show the range of -5 to +5 with the resolution settings of HQ, SHQ and TIFF. The test images are a cropped piece of much larger files. They represent what the original image would look like when displayed at 300%. There was some degridation in the image quality since all of the samples were saved as JPGs.
I also tested the RAW format. The C5050-Z is the first C-series cameras to allow the option of using a "RAW" format (a .ORF file) for the resolution setting. This format is the data as it's stored in the camera without the normal conversion to JPG or TIFF formats. On a computer, a translator must be used to work with RAW files. Adobe sells ($99) a RAW plug-in for Photoshop 7.01 (and Elements 2.0). It is a great tool and allows a wide variety of adjustments to the image before it is imported into Photoshop. It contains an adjustment for sharpness and smoothness, both with a range of 0-100. Note: changing the camera's sharpness setting has no effect on a RAW format file.
Bottom line: The smoothing and sharpening done with the camera's -5 to +5 settings is noticable. However, the smoothing tool of the Adobe plug-in is astounding...at 100, the smoothing is extreme. I normally go with the default setting of 25.
| Here's a reduction of the original image.
The samples are from an area from the upper left.
Here is a combination of a portion of the test images so you can see the results side-by-side.