Just got my iLife '06 suite yesterday and ran into something very disturbing: something wrong (on my system) with the colors of RAW files once you go into editing mode. In the library view, they're fine. Try to edit one, and after a few seconds, there's a final refresh of the image window that heavily alters and bands the colors. (Looks almost like a poor conversion down to 256 colors or less - it's that bad).
This is happening on Canon 300D and 20D raw files, and did NOT happen with iPhoto 5. The RAW files open up and display just fine in Preview (as well as 3rd party apps) - problem is in iPhoto 6 only. I've already sent in a bug report - has anyone else tried double-clicking on a RAW file to go into Edit mode yet?