Sat 02-Feb-13 11:26 AM | edited Sat 02-Feb-13 11:28 AM by ericbowles
Phil and Jon provided a good description of the issues.
The actual RAW file is the same regardless of which picture control is used, but the picture controls apply some global enhancements to the image for the small embedded JPEG that is viewed in the LCD and in thumbnails. If you are using a Nikon editing program, the picture controls are honored in the final image - and they can be changed. If you use a program that does not honor the camera picture controls - like Lightroom - the picture control only is used for the LCD and initial thumbnail.
Most picture controls have some positive value for saturation and contrast. Vivid applies a relatively high level of saturation and contrast which can cause the small JPEG to show clipped highlights and shadows that might not be in the image with the Neutral setting. This might cause you to make inaccurate decisions about exposure which is the real problem.
I use the Standard picture control and understand that I may occasionally need to change the picture control in post processing since I use Capture NX2. I have a picture control called Neutral No Sharp that not only applies the Neutral setting with minimal contrast and saturation, but also removes all sharpening.
LR and PS ignore the picture control settings and apply their own versions - depending on your selection - but the RAW data is unchanged.
The information captured in the NEF is the same regardless of which picture control is used UNLESS you adjust exposure because of the LCD. What you want to avoid is making unnecessary adjustments to exposure, and the Neutral setting helps to better show what is in the RAW file. But the Neutral setting also does not have the "hidden" latitude for adjustment inherent with Standard or other settings.
If you choose to use Neutral, you will have an LCD view that most closely reflects the RAW file, but it also means there is less margin for recovery (since there is no contrast or saturation to be removed). Also keep in mind that any contrast or saturation applied as part of your ingest routine may also hinder recovery of highlights and shadows, so you need to be careful with images that have a wide dynamic range.