The Panasonic LX5 goes to f8, not more, and at f8 we already see strong diffraction, but the images respond very well to careful sharpening.
F8 does not sound like much, in fact, many cheaper DSLR lenses start at f8 being usefully sharp, and depth of field at f8 is pretty OK if you don’t focus too near. You must not forget though, that small-sensor cameras like the LX5 inherently have much more DOF. Both can be advantageous, depending on what you want to do.
Here I was after maximum sharpness from front to back, and that is exactly what I’ve got. Achieving the same result with a DSLR would have been impossible. Well, you know, shallow DOF has its merits, but often we want the opposite, and then a small-sensor camera is clearly the weapon of choice.