Sorry if my explanation is confusing, but what you see in his pictures are not what you will see in real life. His images are very overexposed, which illustrates the problem better. Your picture was underexposed, which hides the problem. Because of this, I had to extrapolate based on what I saw and made an educated guess.
To make a apples-to-apples comparison, you need to take a picture and expose the image so that the brightness of the "21" box matches the brightness of what my image in the OP, or talonted pictures look like. Then you compare the brightness of "1" box to talonted's middle picture. My phone looks like the two on the side. The one in the middle is correct, or at least closer to correct.
OK, I tried to overexpose my shot as best I could. I think I may have overdone it, but I thought I'd add another picture of my phone, now running the Seraphim ICS ROM on it.
You can clearly see the drop from 1 to 0 on this one, but as you say - what you see in this pic is not what you see in real life. I guess I see what you guys are talking about now that I've overexposed the shot, but in "real life", it works well enough for me that I'm going to hang on to this one. Dark Netflix/Youtube videos come through fine for me.
Again, I understand what you're saying now, and I agree that all of these Notes appear to have some deficiencies in rendering a smooth fade from black to grey from 0 to 1 and beyond.