Lots of good information in this thread!
Schewe (Jeff?),
You're right - it would be nice to have the option to see a linear histogram vs. a gamma-adjusted one. But as long as we treat the (Canon) histograms as representing the gamma-adjusted scene, can't we make make judgements based on the histogram?
Something I'd like to learn more about is the process of adjusting the image in Camera Raw (or other RAW converter) to take advantage of the linear data, while minimizing noise. I see relationships between the "exposure", "lightness", "darkness", and contrast controls, but I'm still unsure what, exactly, they're doing to my data. Yes, I've tried manipulating the sliders and watching the histogram. I still can't generalize to understand what's happening, beyond noticing the changes to the image.
Ray,
You raise a good point about the interconnectedness of dynamic range and signal-to-noise. And I agree with your description of how to handle the case where the camera has less dynamic range (with acceptable signal-to-noise) than the scene.
As for your other example where the camera has more dynamic range than the scene, It seems that the "best" approach would be to overexpose the image, while being careful not to blow out the highlights. That way the majority of the pixels are up out of the noise. If I understand this correctly, more bits are used to represent the image data the farther to the right the data is in the histogram. This should be the case whether the histogram represents gamma-corrected data or linear data.
In Photoshop, (or RAW converter) I suppose one goal would be to adjus the image to look, as much as possible, like the original scene. (Yes, many photographers prefer to take liberties with the image, and that's okay too.) Whatever the goal, if you wish to portray lots of deep shadows with little or no detail, then moving the left slider to the right will accomplish that. If you want to preserve lots of detail at the bottom-end, then perhaps adjusting the middle slider would be more appropriate.
These steps would tend to "undo" the overexposure, and possibly "stretch" the image to fill the histogram. But it seems that one result would be to avoid the "noisy" left side of the historgams, possibly resulting in cleaner shadows.
Okay, I'm all ears if I've bolluxed any of this up!
Enjoy!
-- Jim