I have to admit that I have been a bit sloppy with my digital work flow recently, mainly because I take snapshots these days with my Pentax K10D and I no longer use a complete colour-managed work-flow even though I have the kit to do it.
Orginally, when I was using the K10D to photograph textiles, I set it for raw mode output only with an Adobe RGB colour space. Fine. No problemo. The camera spat out 48-bit DNG images and Photoshop yummed them up.
Now, however, I've switched to JPEG output since I don't need to be so fussy about image quality and JPEGs take up far less room, but I've left the colour space set to Adobe RGB instead of switching it to sRGB. No problemo? Maybe not.
The CMOS sensors in my K10D and your 350D both produce 12-bit values for each colour (red, green and blue) in an image but these values must be manipulated before they can be stored in an image file using the required colour space. My K10D produces 48-bit (3 x 16-bit) DNG images in RAW mode and/or 24-bit (3 x 8-bit) JPEG images in compressed mode, and I can select sRGB or Adobe RGB colour space for either image format.
Now Adobe RGB provides a larger colour space than sRGB and so more bits per pixel are required to provide the same level of colour gradation. If, on my K10D, I select RAW mode with Adobe RGB there is no problem since the 12-bit colour values can easily be up-scaled to 16-bits with plenty of head-room for the extended colour space.
However, if I select JPEG mode with Adobe RGB, then I may have problems since the 12-bit colour values must be down-sampled to 8 bits and then down-sampled some more to provide the head-room that Adobe RGB needs. I would be much better off switching to sRGB with JPEG output to avoid this extra compression and inevitable loss of image quality. Of course, if the K10D produced 16-bit JPEG images, there would be little to worry about.
I'm not sure if the K10D can capture colour values outside the sRGB colour space. I'll have to find out. If it can, then it makes sense to use Adobe RGB with RAW mode. If not, then I might as well stay with sRGB. Since I shoot mainly in JPEG mode these days and the K10D only produces 8-bit JPEG images, I should definitely be using sRGB. You should probably do the same.
There are plenty of useful articles about colour spaces on the web written by people with a lot more experience that I have. Try this one.
'Sir, please,' she said... 'Will you not share your wisdom with us?'
'I have no wisdom,' he told her.
'Your experiences, then?'
'They have been trivial, uninteresting, and full of error.'
Ian M. Banks - Feersum Endjinn