Originally Posted By: hybrid8
Thankfully, this is starting to seem more like a software bug rather than a hardware limitation though.

It's actually very hard to tell properly-dithered 16bpp images from 24bpp, especially on such high-resolution (high DPI) screens. But bad dithering, or no dithering, and yes you get visible banding. Apple conspicuously don't actually say what the hardware bit-depth is on the Iphone (or, for that matter, Ipad).

Peter