Although the saturation of the G1's images drops as the sensitivity rises, the amount of rendered detail is well preserved. This is exactly the result we'd expect to see if chroma noise reduction was quite high but luminance noise reduction was kept low. It's a credit to the camera's jpeg engine that it's able to produce this result without the need for post-processing (which many buyers of a camera at this level won't want to do), and the ISO 1600 performance is broadly competitive with any of its peers, though the EOS 450D still has the edge here.
ISO 800
Panasonic DMC-G1
Sony DSLR-A350
Olympus E-520
Canon EOS 450D
ISO 1600
Panasonic DMC-G1
Sony DSLR-A350
Olympus E-520
Canon EOS 450D
ISO 3200
Panasonic DMC-G1
Sony DSLR-A350
* Additional sensitivity settings denoted by the manufacturer as boosted or equivalent to that ISO setting.