An uncompressed NEF, which the D100 supports, has 4096 tonal possibilities per photosite. A compressed NEF is generated by throwing away all but about 500 tonal possibilities, then compressing that further. Upon expansion, it is expanded back to 4096, but the data is now what is called "posterized" (has gaps). Nikon gets away with calling this "visually lossless" because our eyes can't resolve more than an 8-bit RGB image can, and 500 data values would be a 9-bit RGB image. Still, the difference has implications in post-processing. When you start running color changes and sharpening, if those changes are aggressive, you'll sometimes see minor differences on edges and in tonal ramps.
Thom Hogan, writer/photographer
author, Nikon Field Guide & Nikon Flash Guide
author, Complete Guides to N65, N75, N80, F100, D100, D1 Series, S2 Pro
www.bythom.com