The GoPro does have serious limitations when compared to say a housed Canon G9 or G12 costing about $800. to $1600. or so. The underwater sharpness is less, the lower light capability has limitations as has been stated. These limitations become even more pronounced when compared to more capable and costly DSLRs which when housed can run many thousands or more.
Strange thing is when I dive I often carry both. I use the Canon for still shots and the GoPro for video. If I don't want to carry extra gear, want to focus on video, I usually just carry the GoPro. If I need higher quality still shots I will focus on the Canon. I started using GoPros about three years ago with the WIDE. The WIDE had even poorer underwater focus than the current GoPro HD cameras and yet it took some images I have yet to equal with other cameras, even more expensive ones. The wide angle optics provided some pretty good, intriguing images. The WIDE had considerable hassles with short lived rechargeable batteries, long charge intervals, despite that I went to all the trouble repeated for a reason. The images were unusual and quite good in compared to other consumer cameras, like the Olympus 770 sw (about $650. housed, leaked otherwise). Also, being able to use them hands free in a chest, helmet, tank or other mount can be a big advantage for some applications. Just put it on and forget about it while it captures what is going on. I've had five of these little cameras, lost one, and will continue to use them. They do things for their small size that are hard to equal with other cameras. All this for about $270. with standard housing, $370. with a Sartek or Eye of Mine housing for the GoPro HD, the WIDE is now somewhat obsolete.
Checkout some of the images at the following link. Most of the underwater stuff was shot with GoPros.
RickI's videos on Vimeo
btw, the first one on the Abu Galawa wreck was shot almost a year and a half ago with the old WIDE camera. It has fuzzy focus but compare it to something shot with the newer HD like the UW Grand Prix Race in somewhat poor viz.
