I think I've gone through full-cycle with my preference for ISO settings on my camera. As a newbie, I primarily had the camera set to ISO AUTO because… well, it was just easier. As my skill level increased, so did my utilization of the camera controls. For some time now, I've been setting the ISO value manually while shooting in aperture priority mode. Manually keeping your ISO as low as possible is a great way to ensure high quality images, and I'm not disputing that it's totally necessary with certain types of shooting.
But very recently, I went back to shooting ISO AUTO to evaluate the trade-offs between convenience and quality. What I found was that my camera limits the ISO value to 400 or lower when in AUTO mode. A comparison of an image shot with my camera at ISO 400 versus ISO 100 tells me that there are very subtle differences in quality, sometimes unrecognizable (especially with black and white conversions). But convenience alone isn't the real reason I've gone back to ISO AUTO.
The camera sets itself to the lowest possible ISO value based on the lighting conditions — so with bright scenes, I'm still shooting at ISO 100. I also found that the camera won't let the shutter speed fall below 1/60 seconds as long as it has enough room to bump the ISO value up to the next level. This is nice because it keeps me out of that 1/15 to 1/45 area, which most of us would still shoot at but is very prone to producing soft images. Another neat thing about ISO AUTO is that the camera will set the ISO value to things other than 100, 200, or 400. I noticed some of my low-light shots coming out at ISO 100, 125, 160, 200, 250, 320, and 400 — so it's actually giving me a finer control over the exposure.
What do you guys think? Is ISO AUTO just for newbies, or is it actually useful for the skilled photographer too? I'm curious to hear how other cameras deal with ISO AUTO, so if you've messed around with it drop some insights into the comments.