The 17mm lens that comes as part of the kit is the better, more expensive f1.8 model, not the cheap f2.8 one. It renders nice out-of-focus highlights; the grainy look in the out-of-focus areas is due to the sensor.
In contrast to the 17mm kit lens, the 45mm f1.8 lens is a little sharper, better showing what the camera is capable of. Note that this is not a direct comparison shot from the previous slide, as the aperture settings are different, but offered for illustration purposes.
The harder-to-process areas of JPEGs get pretty mushy by ISO 800 (the out-of-focus and darker areas), but sharp areas are handled pretty well. There's a lot of aberration reduction going on here as well.