David,
I believe that error diffusion and diffusion dithering use the same
algorithm. I thimk that you are stuck with the "gritty sky" unless you use a
paper with enough texture to hide the dots. Even with continuous negatives
grain tends to show up most in light grey featureless areas. Several times
in his book he refers to different effects obtained with varying exposure. I
asked him how come, since bit mapped images are supposed to be immune to
exposure variations. He told me that because of dot gain his negatives tend
towards continous. I suspect that under flouresent lamps there is some
spread or "leakage" that averages the light therefore minimizing the dots
without effecting image sharpness too much.
Please let me know how you make out with your experiments. I have not gone
out for high resolution negs. yet. As soon as I get my zip drive I will take
some files to the local service bureau as a test.
Most of the professional labs in my area (NYC, NJ) have the ability to blow
up a 4x5 to 16x20. I suspect they can also blow up an 8x10 since they
provide 35mm proof sheets on 11x14 paper.
Keep in touch
Thanks
Al Strauss