Panasonic Lumix LX3 in a Coolpix 5000 Ikelite housing

The Panasonic LX3 is a superior compact digital camera, potentially one of the absolute best for underwater photography.
The only problem being no-one apart from 10Bar made a housing for it.

Why is it such a good compact camera?

Only 10 megapixels
That's why the image quality is superior. Panasonic have resisted the mad megapixel competition, aiming for better image quality rather than a higher megapixel number. The more megapixels you try to squeeze out of a small sensor the worse the digital noise at higher ISO.

3 times zoom starting at 24mm
Not much of a zoom range, but that's why the lens is better. A large zoom range is not useful underwater. Panasonic uses Leica lenses, in fact the LX3 is pretty much just a rebadged Leica digital camera. The 24mm wide end of the zoom with 1cm closest focus is perfect for underwater photography

It's important to note that any lens wider than about 35mm (in film terms) needs a dome port to prevent unsharp and distorted corner detail.

3 inch LCD
Which is brilliant for viewing your images underwater.

Full control over all settings
For decent underwater photography you need to use manual exposure settings, or at least have control over the auto exposure settings.
As I use the LX3 in a housing designed for a different camera I can't change exposure settings. I can however pre-set the camera to use Aperture priority, select f/8 and dial in some minus exposure compensation. With the flash popped up shutter speed is limited to no longer than 1/30th sec, which is also desirable.
I use an external Inon Z220 strobe which has manual power adjustment. The Inon is triggered by fibre optic sync cord via the LX3 built-in flash.

What this means is that I can forget about the camera exposure. If there's plenty of ambient light it will under expose it by whatever minus EV I have set, but never use a shutter speed longer than 1/30th, and I have full manual control over the exposure from the strobe.

HD (720) video
HD video with the ability to pre-set exposure compensation. With most underwater video you need to underexpose by about 1 stop for more realistic results and the LX3 allows that.

Adapting the Coolpix 5000 housing
My first digital underwater setup was a Nikon Coolpix 5000 in an Ikelite housing which served me well for 5 years. The Coolpix rig doesn't get much use these days so I set about adapting the housing for the LX3.

I needed to shift the camera mounting-bolt hole so that the LX3 lens aligned correctly with the housing port hole and the camera was as far forward as possible. This involved unscrewing the camera base plate from the housing rear door and re-attaching it as far to the right (in this picture) as possible. Then I had to accurately drill a new mounting-bolt hole.

With the camera mounted in this position there was no vignetting of the 24mm lens using the dome port. The dome port gives sharp undistorted results right to the corners, which is actually much better than the Coolpix 5000.
I then needed to extend the shutter release lever to operate the camera. The extension knob was carved from an old nylon bread board.
The Inon external flash is triggered by a fibre-optic sync cord which is taped to the housing in front of the LX3 flash.

Some recent results

Jervis Bay - LX3 Aperture priority f/7.1, -0.7ev, manual strobe

Video from Point Lonsdale Victoria. -0.7ev, UK Light Cannon HID torch with 2 diffusers