I have recently acquired a Zeiss Photoscope (in effect, a spotting scope with an integrated camera) which records raw images as either JPG or DNG files or both. (I'm a birdwatcher who likes to take photos of them, not a photographer first and foremost). When I view the images in iPhoto 9.2, the highest quality JPG files are far superior to the DNG files, even though the JPGs are about 2 MB while the DNGs are 14 MB. The DNGs are obviously pixellated even at low ISO settings (50 or 100), while the JPG images appear sharp and show pixellation only when blown up digitally in iPhoto.
In some cases, I see evidence of chromatic aberration in the DNG images that is less evident in the JPG files, too.
Is there something about the way DNG files work with iPhoto that causes this? Is there recommended software for looking at DNG files that might eliminate the problem? Any other ideas about how to resolve this?