Obviously I chose the XZ-1 for "pocketability".

The E-PM1 will be better on wide end of the zoom and about the same at the long end of the zoom.

And you can't pocket it. The body is about same size as the XZ-1... as slippery too but the lens is thick so end up still take up quite a bit of space.

It'll definitely be cleaner at higher ISO with the EPM-1. The XZ-1 is good up to ISO400 at best. And you're right, the video mode on the XZ-1 is a joke. Don't even bother with it. Nowhere near 720p quality. 

IMO,
On size... for me, size of most mirrorless camera also ok di but problem is thickness.

The thinnest m43 pancake lens is the 14mm panny which is ~20mm thick.

E-PM1 is ~8mm thinner than the XZ-1 so even with the thinnest pancake prime... it's still about 1cm thicker than the XZ-1.

I feel the XZ-1 is already bordering on the maximum thickness I can fit into my pant pocket (still bulging like hell).

Video wise....the XZ-1 video mode sarks balls. Period.

Check out the vid samples for the E-PM1 on vimeo/youtube or various review sites la... I think its still smudged and with artifact... I think Iphone vid also better (in fact, I use the XZ-1 as my everywhere camera but when vid is needed.... still use Iphone) 

Oly vid (OM-D aside) still lacks behind Panasonic and Sony.

Somewhere in this thread (I think)... I posted about the dof comparison between XZ-1 sensor size/lens speed combo vs various others including m43. If strictly only using the kit zoom, XZ-1 has a more shallower dof.

Noise wise.... yes... XZ-1 sensor is noisy but this is counter-balanced by its very bright lens. You'll have to get fast primes on m43's to beat the XZ-1 for low light.

Some night time snapshots during my late night jalan jalan session with the XZ-1

---

Added on June 27, 2012, 1:02 am

m43 with 12mp is only about <2 stop better niah. My beef is not so much so high ISO (at least the detail retention is good here) but more of low ISO noise and the shadows/DR

I shoot RAW and convert via Lightroom with a preset for masking, some sharpening and noise reduction for most photos.

DR is the same between all the m43's (except OM-D and GH2) and the XZ-1 = not that brilliant.

Good DR have to go NEX-5N di.

FF DSLR where got so cheap

Anyway... you're right. By tradition... most compact cameras got heavy noise reduction.

That's cos it caters for the mass consumer market and...Girls like heavy noise reduction for smooth skin. That's a selling point

Average joe used to compacts not that particular about details but cringes at the slightest noise.

Truth to be said, at least Oly don't do like Sony who happens to think ISO1600 (that's what the auto mode does) is perfectly useable on a tiny sensor HX9V.

If you're not familiar with post processing... you can just shoot jpeg+raw. For those shots that you wanna keep but think the NR is too heavy... just run the raw through the bundled software...select the image... go to the RAW tab... change to no noise reduction = Win.

HAhahahaha..

Most pics by default I'll raise the exposure compensation from +1/3 to secukup rasa. I find that helps with the shadows though have to avoid the skies la. If got sky.. then see histogram and shoot.

Go home run the RAW through Lightroom via a preset I saved with following (if remembered correctly.. using office notebook now)

- Standard profile.
- Sharpening amount --> 30
- Sharpening radius --> 1.4
- Sharpening masking --> 36
- Noise reduction Luminance --> 12

Most of the time... that'll do though for some pics require additional cooking. Maybe add some fill light and play with the curves a bit.