What's the difference between 16-bit and 8-bit/channel? When should I use one over the other?
Bit depth is a measure of resolution for digital images that allocates a "bit" for every pixel. For example, a one-bit image has two possible values, black or white. Because the math is exponential, the numbers of pixel possibilities rises quickly as the bit depth increases.
RGB files that have 8 bits/channel of information are 24-bit in total.
8 bits/channel x 3 channels = 24-bits.
RGB files that have 16 bits/channel of information are 48-bit in total.
16 bits/channel x 3 channels = 48-bits.
Personally, I scan, capture, and retouch 48-bit files whenever possible. Here's why:
Photoshop CS2 fully supports higher bit depth files. (That means all the tools and filters work)
48-bit images are, essentially, divided into smaller, finer pieces which gives you the ability to manipulate smaller, finer pieces as well. That my friends will result in better Levels and Curves adjustments and less posterization.
When you are ready to print, make a duplicate, and change the image mode to 24-bit.
Choose Image > Mode > 8 Bits/Channel.