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The use of the [0,255]->[0,255] is justified because they say it's a more smooth conversion from YUV to RGB which could cause less banding. For me, I think the best should be the compromise solution.
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Perhaps so. But when doing a [0,255]->[0,255] the black portions are too black and the bright ones are too bright. Imo, that's more annoying than any banding.