LX-5 is a very nice camera.
It has good IQ, fast AF (very close to the fastest 4/3, but not as fast as the super fast Nikon J1) and good video. On top of this is has tons of useful features and is very sturdy build. Everything about it feels high quality.
And it's still pretty small and light.
No you don't have to shoot raw all the time. I use on land as well and the colors are very nice. If you don't like it out of the box you have many options to fine tune how the jpg should be created in the camera.
Raw in combination with a good raw converter will, like on any compact give you higher IQ. Less noise and less jpg artifacts is what I appreciates. The IQ you get after processing its raw files in e.g. Lightroom 3 (simply a little sharpening and a little nr) is amazingly good. You can even batch process your raw (using the same nr and sharpening) and get really top notch jpg without any efforts.
But, my suggestion is to shoot raw+jpg. It takes no extra time and if you don't have a raw converter at hands, you simply go with the jpg.
I love that you can easily move the AF. Not many compacts can do that.
Ikelite also has their smallest uw-housing ever made for a TTL camera. It's exactly like a schrunk D-SLR uw-housing. With Ike strobes you get real TTL with cable. No need to use the internal flash, waste battery and get slow reloads.
The housing isn't perfect but at that price and with true TTL, it is very hard to beat.
If you want to spend more money their are smaller, lighter housings with better ergonomics. But, not with true TTL.
It has a 100% fully manual video mode wich is great. You can even alter the expose during filming. You can even zoom during filming. But perhaps the best part is that it has an excellent following AF while filming.
You can also here change the way the colors etc are created.
Sure it's only 720p, but it's h.264 and is silk smooth.