Working with 16-bit Files -- Some Thoughts

I do agree with everything (nice summary)

Since comments are welcome, I'd like to stress a few facts:

1 - If you work in the ACR module, all your calculations are done in 16-bits. The menu choice for 8 or 16 bits is only to choose the format when sending the edited image to the editor. If you start from a raw file you start with 12 or 14 bits precision. The difference between 12 or 14 bits is very hard to reveal. If you start from a jpeg (necessarily 8-bits), the advantage is that you don't get 'rounding errors' in calculations, providing smoother gradients. The other advantage of the ACR module is that you are working in a wider color model as the common sRGB. That is helped with the 16-bits ACR editing. The result is also finer color control. You'll see that editing in ACR first makes 16-bits editing useless (redundant) for ulterior editing in nearly 100% of your shots...
2 - Hard fact: your display and home printer are only 8-bits.
3 - Starting with a 16 bits image, if you convert it to 8-bits (same file), you can't see the difference on display or print, even with a 16-bits printer. That's why the jpeg format with low compression is ideal for printing output.
4 - 16-bits editing is useful, not only for theoretical reasons, but for a very real and annoying limitation in 8-bits: our eyes are apt to grasp the difference between two adjacent areas in very soft monochrome gradients, such as in a sky. The ugly result may be posterization, or banding. With finer tones in 16-bits, the gradient can be smoother. Even with 16-bits, posterization can happen (the cure is to add some noise). This type of banding may be the result of using extreme edits stretching the tones or some layers blending modes like difference. Since 16-bits mode is not supported with layers in Elements, be careful with such edits; however you are safe if you work in 'normal' mode. The lack of 16-bits for 'detailed' adjustments like sharpening or dust removal is never a problem, it's only with wide areas gradients.
5 - So, keep an eye for posterization if you think your image has such smooth gradients. Be aware that it is rather common to see false posterization artifacts only on your display (some are not even 8-bits...), check that on test prints.

To summarize, don't make your worklow harder than needed and don't think you have to upgrade to Photoshop for that reason.
Work in ACR first, know when you risk posterization and which kinds of hard edits may produce it (especiall in black and white).

Just for play:
Choose a file with a soft sky gradient.
duplicate the layer and use the filter adjustment >> posterize

Set layers with the values : 128 (7  bits), 64 (6-bit), 32 (5 bits)

That gives you an idea of the loss of gradient smoothness with lower bit depth.

I’ve been playing and experimenting with 16 bit images since Mark Galer first posted a PSE 10 tutorial about a 16 bit workflow.
www.youtube.com/watch?v=sA2_pEg-8pQ

When working in PSE there are work arounds that make it possible to create layers and add masks. Also, Nik Color Efex and Topaz filters can be applied. When I read this post, I decided to open a recent photo and play with it as a 16 bit image. Below i posted a screen shot of my workflow. The top red arrow shows that it is a 16 bit image. The arrow pointing to layer four reads … stamp visible+mask+topaz b&w. I also sharpened with high pass filter and added a vignette.

Conclusion, you can edit a 16 bit image in PSE … BTW, my Epson printer allows for 16 bit printing and I’ve tried it but I did not see any visible difference (comparing to a printed 8 bit image).  

I should also note that once a new layer is created, Stamp Visible becomes available. A mask can be created by first creating a selection and then selecting the mask icon.

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