Not all converters are going to support all formats. It takes work on the part of the developers to support a new format, and they have to decide the best way to spend their time.
Dave Coffin did a very major rewrite of dcraw.c in order to support DNG. Eric does not base his code on Dave's, and it would probably be an awful lot of work to support it. I'm sure he's aware of interest in it.
In the interim, I'd send a note to Eric Hyman (founder of Bibble Labs) and let him know you'd like to see support for your camera directly (that way, you wouldn't need to convert to dng first). If enough people are interested in seeing it supported, I'm sure he'll consider it.
In the interim, you've got other options.
Id' make sure to check out DigiKam (free). It's got a pretty good user interface, and I find myself preferring it's tools to some of the better known image editing applications for simple taks (USM, etc.). You'll also find it available in the repositories for most Linux distributions that use KDE. The newest versions of it use a separate library called libkdcraw that's based on dcraw.c. The version in it may not support your camera yet (digiKam 0.92 uses dcraw.c version 8.60).
But, it will as time passes (they use newer versions of dcraw.c to make this library with every new release). digiKam 0.9.3 should go final in September.
There are also instructions on their web site for compiling it with the latest dcraw.c if you don't want to wait until a newer version comes out (but, you'd need to download all of the dependencies needed for digiKam, too).
http://websvn.kde.org/*checkout*/trunk/extragear/libs/libkdcraw/dcraw/README?pathrev=635195
It's got loads of nice features (and even if you use another raw converter, you could still use it for image management and basic editing tasks). It would probably work with dng files as is with the older library based on dcraw.c 8.60 anyway. Try it and see. But, the next version should support raw files from your camera directly (since dcraw.c now does).
http://www.digikam.org/?q=about/features09x
The free Krita is moving along nicely. It uses the dcraw.c engine for raw conversion.
It's part of the free KOffice suite, and a number of improvements were made to newer versions of Krita. Krita supports 16 bit editing, raw conversion, layers, color management and more.
http://www.koffice.org/krita/
Yet another product worth looking at is Lightzone. It's user interface takes some getting used to. But, it's starting to grow on me a bit.
The Windows and Mac version of it are $149.95 or $249.95, depending on the version:
http://www.lightcrafts.com/index.php
They offer it free for Linux users (no support though, as you'd expect since they are kind enough to make it available for free to Linux users). It supports dng
http://sonic.net/~rat/lightcrafts/
A lot of Linux users like Cinepaint for image editing. It's a GIMP "fork" (most code oritinally based on the Gimp) and supports editing in 16 bit mode. It's free.
http://www.cinepaint.org/
You can also get a number of Windows image editors to run under Linux via Wine (a free product that lets Windows apps run in Linux). For example, the FastStone Image Viewer runs under Wine.
You can install Picasa in Linux now, too (although it's not native to Linux):
http://picasa.google.com/linux/
Check out Raw Therapee, too. It supports your camera directly now:
http://www.rawtherapee.com/
There are more out there. These are just some of ones I've installed before.
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JimC
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http://www.pbase.com/jcockfield