Olympus' TruePic V image processor delivers decent noise performance for this price class, with clean photos up through ISO 400 and only slightly degraded photos at ISO 800. Oddly, at all ISO sensitivity levels the E-P2's photos look a bit noisier than those of the E-P1's.
The E-P2's high ISO sensitivity performance is actually a bit disappointing; it seems to get soft a stop sooner than the E-P1, which is a less-expensive camera. I don't really recommend using it above ISO 800.
For a camera its price, there's more color noise than I'd like at ISO 1,600 with the default level of noise suppression.
(1/30 sec, f4.2, ISO 1,600, ESP metering, AWB, 14-42mm lens at 22mm, Natural color)
Even with noise suppression set at its maximum (bottom) you can still see a fair bit of color noise at ISO 1,600, though its not nearly as bad as the standard (middle) or minimal (top) settings.
(1/40 sec, f4.7, ESP metering, AWB, ISO 1,600, 14-42mm lens at 29mm)
At its widest, 14mm (28mm equivalent), Olympus' standard Micro Four Thirds kit lens displays noticeable, but not egregious, barrel distortion.
(1/40 sec, f16, ISO 100, spot metering, AWB, 14-42mm lens at 14mm, Natural color)
Like the E-P1, the E-P2 has excellent color reproduction, at least when set to Natural Picture mode, the default in any of the PASM modes. i-Enhance is a variation of Vivid that more selectively boosts contrast and saturation--which produces strong color shifts, as you can see here--and is the default in iAuto mode. Unfortunately, all of the parameters for the Picture modes are zeroed out, so you have no real sense of how the settings differ, say, between Natural and Vivid. (1/100, f5.6, ISO 100, spot meter, AWB, 14-42mm lens at 42mm)
One of the nice things about the Olympus kit lens is its ability to focus very close. It's also relatively sharp, and doesn't produce the fringing that frequently occurs on this shot.(1/60 sec, f5.6, ISO 400, ESP metering, AWB, Natural color, 14-42mm lens at 42mm)