-3db gain vs. 0db gain.
 

I realized there is something i dont know but feel i shou;ld.
What is the advantage of shooting -3db gain over 0db gain. I suppose -3 db can help in very bright situations, but for the most part does it improve the image quality?

I doubt you would see that much of a difference, since you will probably have more than enough light for a decent exposure. I use -3dB on those occasions, but I can't quantify the difference in picture quality. Sure, in theory, the less gain, the cleaner the image. But 0dB is pretty clean. Perhaps at the 1920x1080 HDMI output, you might be able to scrutinze the image noise characteristics enough to see a difference.

I used it when shooting the stars once. I used 16frame slow shutter and -3gain. It brought out the stars while keeping the sky relatively black.

The orion nebula (the little smudge in the center)

So my general question is; If you are in a situation where you can use -3db gain and still expose a bright enough image, then should you always use it in this case?

I think when shooting indoors you should keep it 0db. Outdoors or very high-contrast shots I'd switch it to -3db.

There is something strange in the gain setting in the sense that how come the sensitivity of the sensor be adjusted? And if the gain adjusts the level of the signal after the CCD, the -3dB setting meant one throws data away from the dark end. So, in this sense one could come to the conclusion that the -3dB setting is in fact the neutral setting. If so, then one should keep the gain in the -3dB position to achieve the best image quality.

I would be surprised if -3db was even the neutral setting. It could still be electronically gaining up the signal even at that setting! Still, it is the cleanest setting on the H1. I use it as much as possible.

0DB is the setting the camera manufacturer uses for giving the standard sensitivity and noise of the camera. All gain setting are just adjusting the amplified signal after the sensor. Other gain settings above and below 0 are to allow the user to modify the cameras sensitivity to make the picture the user wants in real world situations. If noise in the picture is a problem then -3DB will be cleaner but not all other parameters will act the same as if they were in 0DB so some people might not like the results as much as in 0DB. It is clear that when you are in bright sunlight the camera may be too sensitive and turning the sensitivity down can help. In dark scenes it might be better to trade some noise for exposure and 0db or higher might be better. The key is the camera manufacturer is giving you the choice.