I don't own this camera. However I do have an OMD and the same Panasonic lens. I assume you're referring to the "digital zoom" function, where only part of the sensor is used, giving an effectively lower resolution cropped image. This is pretty pointless IMHO, as you can easily crop in post, with the same effect.
Getting decent images at the long end of the 100-300, hand-held, is difficult enough without adding - were it available - a teleconverter, which would necessitate even slower apertures and higher ISO settings.
Roy