All compact point and shoot cameras have tiny sensor about the size of a fingernail on the pinkie finger and then the manufacturers cram a large number of pixels onto the sensor so each photosite is too small to be effective at capturing light. This results in pictures that seldom look great at 8x10 and picture taking at ISO 400 or lower. Add in slow lenses and these are good only for snapshots and 4x6 pictures. Enter the new Micro Four Thirds camera format that has a sensor that is 6 times the size of the compact P&S cameras and with a more conservative 10-12 megapixels in total and able to produce good looking 11x14 prints from pictures taken at ISO 1600.
This is still a small and lightweight camera. The camera with its 14-42mm lens attached and battery inserted weighs only 17 ounces. My DSLR zoom lenses alone weigh more than that, and some more than twice as much. The camera is unusual in that it not only has an internal flash and a hot shoe for a standard flash it will also wirelessly control an off camera flash which can be either one of the expensive Olympus strobes or the excellent Metz 50 AF-1 strobe that costs half as much at $199. The upper end Nikon cameras have this feature but it is unusual to find it on a small camera such as this.
Lens quality is good though they are slow. f5.6 at most focal length settings which is why the high ISO capabilities are so valuable. The camera has internal optical stabilization that is not very good. Optically stabilized lenses are at least 3 times as effective. This is compounded by the lack of a viewfinder. Having to hold the camera away from your face to frame a picture increases camera motion a good deal. I took a series of shots at 1/160th with this camera, a D300, and a D3, and the lenses on the Nikon cameras were not optically stabilized but still the Nikon shots were a great deal sharper. Bracing the camera against something, a tree, wall, rock, or using a tripod would help.
In spite of the camera's shortcomings it is a very big improvement over the very best compact point and shoot cameras available. The larger sensor is the critical factor. For 50% more cash the Sony NEX cameras provide a still bigger sensor and faster lenses but the advantage in size is not nearly as great as with the MFT micro four thirds cameras. For anyone seriously into photography and less concerned about weight on of the entry level DSLR's from Nikon or Canon are a better long term investment.
My wife has been using this camera on our travels and loves it. She is not a camera buff and dislikes reading manuals but found this camera with its sophisticated scene modes very easy to use and with great results. A simple example was taking pictures of flowers on a trip to Costa Rica (which surpasses any other place in this regard where we have traveled). There is a macro flash mode that provided perfect exposures of the flowers with a completely black background. I know how to do this with my Nikon cameras and flash but the Nikon flash alone costs as much as the Olympus camera with its built-in flash and zoom lens (and weighs as much too). Scene modes are nothing new but Olympus has taken a step further than the usual "people" "macro" "scenic" modes I have found with point and shoot cameras.
The Olympus is twice the size of the average P&S camera but provides 6x the image quality and sells for the same price or less than that of cameras like the Canon G series with their tiny sensors. And the Olympus offers the option of interchangeable lenses should you want to do so in the future. I do not even try to use a P&S indoors or in low light situations, but the Olympus is one that rises to the occasion very well. It is not a perfect or the best camera but for $450 it is the best in its class by a long shot.
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