In other ways the E-P1 resembles a compact camera, with shooting settings including Intelligent Auto, a range of 19 Scene Mode programs, and an Art Filter setting, with some fun special effects like a high-saturation Pop Art mode, Soft Focus and a Grainy Film monochrome mode.
The E-P1 also resembles a compact camera in another way; it has no viewfinder, relying instead on its 3.0-inch 230k LCD monitor. Having used the E-P1 over the past week or so, I am increasingly of the opinion that this is a mistake. While shooting at arms length is perfectly comfortable with a normal lightweight, powered-zoom digital compact, it's an awkward and uncomfortable way to shoot with a large and fairly heavy manual zoom camera. An optional add-on optical viewfinder is available, which clips onto the flash hot shoe, but it's only calibrated for the 17mm non-zoom lens, and adds another £100 onto the price.
Another surprising omission is a built-in flash. Again a matching accessory flash gun is available, but it costs another £160. It's doubly annoying because without a flash or any sort of AF assist lamp the E-P1 has major problems in low light levels. It has a contrast detection autofocus system, which is simply not as fast or effective as the phase-detection AF system used in conventional DSLRs, and in light that is still bright enough to read by the camera frequently hunts around for a second or two and then fails to focus, and if it can't focus then it won't let you take a picture.
When it will focus however the excellent sensor-shift image stabilisation system virtually eliminates camera shake at shutter speeds as low as 1/10th of a second even at the longest setting of the zoom lens, a stability gain of around three stops.
Another very good feature is the HD video mode. It can shoot at 1280 x 720 resolution at 30fps, with stereo audio recorded by two microphones positioned either side of the name badge above the lens. The video quality is excellent, as is the audio, but the microphones are non-directional, picking up sound from off-screen just as loudly as from in front of the camera. However the manual zoom can be used while shooting, as can aperture priority for depth-of-field control, and a range of art filter effects. The camera has an HDMI output for connection to a digital TV.
One interesting side-point is that the E-P1 is the first Olympus camera (as far as I am aware) to finally dispense with the expensive and unpopular xD picture cards in favour of SD/SDHC.