The CHDK allows you to store, with your Canon camera, RAW files. Such files (I am sure you know all about this) represent the data as recorded by the sensor plus some meta-data such as camera settings.
RAW is good, it allows to manipulate image data whenever you want, e.g. adjusting white balance. There is not compression in the raw format, since it represent raw data. Which is good, because there will be no compression artifacts.
However, there are some down-sides to ignoring the camera's computations. Since CHDK records both, the processed JPG as well as the RAW (DNG - see below), we are able to see the differences ... fingers crossed that blogger does not "improve" the images.
The images below are results of the same photo, i.e. frame. Both files were taken from the memory card, scaled down and saved as 95% quality JPG.
Lets have a look at the raw image:
|DNG (raw image) as recorded by the camera|
Colors are rich and there is a good contrast. The finer detail, e.g. fancy structure on the left building's roof, show clear definition.
On the JPG side of things:
|JPG as processed by the camera|
However, there is some lens-distortion correction going on. It seems that the camera actually over-corrects. Note that the modern building bends outwards to the right in the upper right corner.
Correct me if I am wrong, in my perception, the over-correction of the camera is less offending than the distortion seen in the raw image. Of course, in GIMP (potentially also in photoshop, but I can't tell) one can correct for such distortions, however, in the daily life of a P&S-user, it might be even reasonable to just go with JPG in the end.
Mind you, even though it might not be advisable, stacking techniques, such as HDR, can be done using JPG.
Note: Pure raw-format changes from camera to camera, hence, sometimes it is useful to use DNG (digital negative) format to store raw sensor information. The DHCK offers the option to store raw images directly in DNG. Personally, I do make use of that option. Up to now, I had no issues with DNG, when created within the camera.