A comment in another thread, where someone claimed to have "processed a Raw file with no tweaks" got me to thinking...
When each new version of Photoshop Camera Raw comes out, I spend a fair bit of time experimenting with all the parameters - and there are a LOT of parameters - until I find a set that delivers an image into Photoshop that I can use for further work.
The "default" parameters for each camera are ANYTHING but benign. There's a lot of noise reduction and sharpening and who knows what else dialed in, and frankly for the highest possible image quality you do NOT want these things. You may have clipping, loss of detail, artifacts... Not good stuff.
One of the first things I do is to switch everything off (or to center scale, depending on what makes sense), then save these parameters as the default for the various cameras I process Raw files for. Another thing I do is to set the color space and image size parameters then convert an image, which causes these particular parameters to be saved as defaults for next time.
Then I start tweaking. Some notable tweaks for the defaults, beyond zeroing the sliders, that I've made are:
>>> In order to keep Camera Raw from underexposing or overexposing one or more channels for conversions to sRGB color space I lowered the default [color] "Saturation" parameter to -15 or so. Sometimes, for particularly dark or contrasty images I have to lower it even more. There doesn't seem to be any advantage to creating a lot of color saturation here as opposed to adding it in Photoshop proper later.
>>> Increase the "Brightness" setting to +50, which is a bit right of center-scale. This seems to be a better way to lighten images than increasing the Exposure slider, which can result in more blown highlights.
>>> Turn off all sharpening (i.e., set the "Amount" of sharpening to 0). While one could debate that enabling some sharpening in the conversion will yield a more detailed image, there are sharpening artifacts that seem impossible to get around any other way. Of course, if Sharpening = 0 is the default one can still add some for particular images. Remember we're talking about defaults here.
>>> For my Canon 20D, I chose to dial in NO "Luminance" noise reduction, and just a slight amount of "Color" noise reduction: 3. More than this and a significant amount of fine color detail gets lost, and less than this and I find that I have to run color noise reduction on even my low ISO images.
>>> Set my color space to sRGB, image size to one notch up from the camera's native sensor size, and the bit depth to 16 bits per channel.
Everything else is off or center scale. Please note these default settings that I'm currently using. I don't claim these are anything like perfect or even optimal, but they're FAR better than the defaults I'd say.
Well, judging from the histogram, you will end up with a very lifeless and low contrast image with these settings. No whites, no blacks, just a lot of midtones packed together. You'd still have to do quite a bit of work in Photoshop. Of course you can work that way if you want to, but I prefer to do most of that work in the RAW converter.
You're welcome to organize your workflow as you see fit, but please don't be quick to judge the merits of my post from a single histogram... Don't forget, we're talking about reasonable defaults here, not the settings that will develop this particular image into a masterpiece.
As it turns out that was a very unspectacular image of a cloud formation, at the edge of a storm with swirling portions that looked as though they might form a twister. I specifically chose that image because it was so drab that I had not even opened it in Photoshop before, and thus it was sure to show the Camera Raw defaults.
You go right ahead and keep your Camera Raw defaults set to high levels of sharpening, saturation, noise reduction, etc. and by all means please post an entry in the processing competition thread.
Sorry for the misunderstanding. I thought this is what you use for output. But if it's just a default, I don't see how you can talk about 'Best Quality'. Let's say that I would use a default with a rediculous amount of sharpening. Sure, that would not be very convenient, because it means I have to turn down that sharpening again for every image. But as long as I do that, the end result is not worse or better than if I started from zero sharpening.
As long as I adjust every image anyway, one default setting is not 'worse' or 'better' than any other default. It's just a starting point, nothing more. If you say that this is the 'Most convenient default', because it means you do not have to adjust that much in practise, I would concur. But that's all it is.
My point here is that I feel leaving some of the parameters set up (e.g., sharpening or saturation) represent potential gotchas (in the form of clipping or sharpening artifacts that are impossible to get rid of). Do you review EVERY setting when converting Raw files, or do you try to start with a set of conservative defaults and turn up additional stuff as needed? The latter method, as I'm prone to using and am presenting above, yields less chance of loss of information if one doesn't remember to tweak every setting every time.
And that's my point too. Conservative defaults are easier to work with (and that's what I use too) because you don't run the risk of doing something by mistake. But conservative defaults do not influence the outcome as such. If you convert the image with all the right settings, it doesn't matter what you started with.
A good example is the white balance. Should you bother to set the right white balance on your camera? For convenience: Yes. If you set the right white balance in the camera, that's one slider less you have to tweak in ACR. For quality: No. No matter what the default white balance was, you can always set the correct one in ACR and that is all that counts in the end.
P.S. I'm the author of a (Dutch) book about Camera RAW, so I think I've probably spend a bit more time on these sort of things than most people have. Considerations like these are part of that book.