The NEX-C3 produces very nice photos, especially given its small size.
ISO sensitivity comparison
The camera's noise profile is quite good up through ISO 400. Photos still look good at ISO 800, though you can start to see some mottling from the noise-reduction algorithms; by ISO 1600, detail degradation becomes visible.
The latest iteration of Sony's Handheld Twilight mode automatically combines six exposures to obtain better exposures in low light than you might otherwise get. It does a nice job, and there's less performance overhead than with the older algorithm, making it a lot more useful.
(1/60 sec, f3.5, AWB, evaluative metering, 18-55mm lens at 18mm, ISO 5000)
The kit lens distortion is so conspicuous I thought I'd botched the shot. Then I went back to my shots and comments on the lens from the NEX-5 review: "At its widest angle, the 18-55mm kit lens displays some of the worst barrel distortion we've seen for a nonsnapshot camera in a while. Goodbye, straight lines."