With the G1 and G10 announcements, Panasonic also introduced a new kit lens. It has a slightly shorter range of 14-42mm (28-84mm equivalent) compared with the older model's 14-45mm range, but it retains most of the same optical characteristics: 12 lens elements in 9 groups with a single aspherical element, f3.5-5.6 maximum aperture, 7-blade aperture, 52mm filter, and closest focus distance of about a foot. It's a hair longer physically--2.39 inches compared with 2.36 for the older 14-42mm, but about an ounce lighter.
Notably different, though, the 14-42mm lens uses an internal focus (the lens doesn't extend as you zoom, instead shifting the lens elements within the barrel). An internal focus system can be quieter than a standard focus system, which is important when shooting video; however, this lens isn't as quiet as the video-optimized and expensive 14-140mm lens that ships on the GH1. Panasonic also dropped the stabilizer switch on the barrel of the lens.
The two lenses I shot--the 14-42mm kit lens and the 45-200mm supplementary telephoto--are pretty nice. The kit lens has some distortion at its widest, but not a lot, is fairly sharp, and only displays fringing in extreme conditions. There's almost no distortion for the telephoto lens at 40mm; if Panasonic's performing in-camera control, it's doing a very good job.
Rating the image quality on this camera turned out to be a toughie. On one hand, it delivers accurate color and exposures, even on its defaults. While several of the preset options do induce some color shifts, they're not as egregious as I've seen on many consumer dSLRs. Panasonic manages to produce exceptionally bright, saturated colors without significantly shifting the hues.
But it also seems to be the noisiest in its generation, with visible artifacts down as low as ISO 200. They're exacerbated by Panasonic's default combination of noise-reduction and sharpening algorithms, but even doing my own processing in Adobe Camera Raw yielded better, but not as good as they should be, results. With the G2's defaults, too many photos look good at small sizes, but up close look like they'd been taken with a point-and-shoot--crunchy, with that oversharpened false level-of-detail look. At ISO 100, however, the default settings don't introduce artifacts as they do at higher ISO sensitivities. They have cleaner edges and lack noise patterns; the image looks quite natural and not digital.
My photos shot with the G1 show a lot of the same issues, but a lot has changed in the year and a half since the G1 shipped--including the competitive landscape and my expectations.
There's tons to like about the Panasonic Lumix DMC-G2--including the photo quality if you're not as nitpicky as me. While it's not as compact as some competitors, it counters them with a built-in EVF and articulating touch screen. As with any EVF-centric model, I don't recommend it if you're planning to shoot action. But for all other types of photography, this is a pretty strong contender.