I'd suggest careful color balancing and exposure adjustments in RAW,
converting to 16 bit .PSD files. Unless you're sending to someone who
insists on TIFFs, the native photoshop format works well in my work
flow. OTOH, I have to convert a lot to jpeg as the final res. for a lot
of web stuff.

Some one else will chime in on DNG; I think I understand it but see no
need for it in my case.

You can't use layers in the initial adobe camera raw or whatever it's
called where you adjust white balance and stuff, but after that you
can. It's best to do all your layering and everything in either RAW,
TIFF, or the photoshop format and then save it in whatever format is
best for what you are doing. If you are putting pictures on the web,
save them as jpeg, if not, you can save them as whatever.
DNG stands for digital negative and is basically adobe's form of RAW,
tho slightly compressed I believe (whether or not it's compressed or
just smaller file sizes I'm not sure).
So in summary, yes you can use layers in RAW and you don't necessarily
need to convert to some other format, tho you should always be sure you
are doing your work in 16 bit format.

[snip]

Here is probably more than you want to know!

http://www.barry.pearson.name/articles/dng/

As I understand it RAW files contain the pixels as they came from the
camera, and the Adobe Camera RAW program does not change anything in these
files. It allows you to modify the way the information is seen, by the RAW
converter, and stores the modifications in it's database. I don't think you
can use layers in Camera RAW. You must convert the file as a .PNG, .TIFF,
both lossless, or .JPG before modifications such as layers may be made in
Photoshop.

Have a look at www.russellbrown.com. He has several Photoshop tutorials that
are quite good, if you can put up with his presentation style. You also may
want to register in the Adobe forums, www.adobe.com. Be aware that before
you ask questions in these forums, it is expected that you have read the
Adobe help files on the subject you are inquiring about. Google camera raw,
and get more information than you will ever be able to read. :-)

DNG is a "standard" Adobe is trying to establish for the file structure of
RAW files. They would like the camera manufactures to incorporate the DNG
format into there cameras. There are pro's and con's to this, but unless you
are looking for a long term picture file retention format, your energies
would be better spent getting to know Photoshop. (IMHO)

Hope this helps,

Holley

I open the RAW file in CS2. Do my color, exposure, etc. corrections and
then click "Open" and the RAW file is opened in CS2. I can now use
layers and everything from CS2. After I finish all work on the image I
save it as a .psd file and a .jpg. If I want to continue working on it
later I have the uncompressed .psd file to work from.