I've been using raw for quite some time (had to download a special plug in for PS CS2, my Olympus C7070 saves in a format called ORF-Olympus Raw File) and yes editing is soooooo much easier. The PS editing functions are awesome. The only problem is, of course, at 7Mpixels a 512MB clip lasts for around 50 photos. And the time it takes to save is also irritating, some times when I spot a car I have to wait a while between multiple shots
That's why for everyday use JPEG is still no1.