
No matter how you fight the fact that the Panasonic AF101 is an 8-bit camera, it still is 8-bit, with the limitations it brings. This camera can be accused of having the lowest DR of all the large sensor cameras and that's probably true to some extent.
There are a couple of goals how I look upon achieving the greatest footage out of this camera. I look at; colour, noise, 8-bit artefacts, resolution, DR and compression artefacts. It's not an easy task to really know what happens when you dial the settings in camera and what happens when you start to grade or push the footage.
The usual thing to do is to shoot as flat as possible to safe as much as you can and afterwards grade the footage to your liking. Sounds really easy and sure enough you can set the AF101 to be very very flat. The problem is the minute you start to stretch that flat image to achieve some sort of contrast it starts to break up. I think it does this due to 8-bit and compression used when recording to the internal cards in AVCHD.
You can try to set this camera to a flat setting by using the Cineline D gamma and master pedal to +5. Also use the noisefree norm2 colour matrix and lower detail and you'll end up with a reasonable noisefree and utterly flat looking image. That can be a nice flat look that can work on it's own but the second you start to grade it it will break. In many scenes you might not notice it thou but looking at gradients show breaking early on when applying a s-curve.
But most of us do prefer a bit more contrast to the image. You can try to use these settings for a very contrasty and punchy image; Cinelike V gamma, master pedal at -4, Norm2 gamma and turned down detail and chroma. The result is a picture with great contrast but reduced DR and might look to contrasty.
So is there no middle ground?
Well, there's one trick that works the opposite to shooting log/flat footage and that is to achieve a flatter look when grading. Thanks to many excellent tools like Magic Bullet you can shoot with the most contrasty setting and still end up with a just enough flat image.

The image above shows a frame grab from my "clean" settings. Settings are; Cinelike V gamma, norm2 matrix, master pedal -4, chroma -4, detail -4, v detail -4. I would say this scene file has the lowest degree of noise so check on noise. I put a white card in the frame that is clipped and there are details going into black and levels in between. Focus is set on the plastic bag and the printed text to show resolution.
One misunderstanding I see often is this camera is noisy even at ISO200 but it all comes down to the settings you use. The example images you see here are shot in ISO1000 and using my clean settings the footage is pretty much free of noise.
In itself it looks okay except for the clipped white card and if you check on the lower right corner there's chroma skew due to a couple of things. First it's the settings to have a high contrast image that introduced the chroma skew, then it's the norm2 matrix which boost colours. I think the Cinelike V gamma has a nice high roll-off and the white card is clipped but doesn't really look ugly, just clipped.

Now look at the this image. It looks really flat right? I would say it's a bit on the wild side, but I made it this way to show you can do a reverse log/flat thing with the AF101 that doesn't introduce noise or 8-bit/compression artefacts.
If I had done it like one expects - to shoot as flat as possible in camera and graded to look like the contrasty image earlier, it would have gone broke by now. But doing it the reverse way works with the limits of this camera. Since 8-bit only has so many levels it just breaks when you stretch it but not when you make it flat.
You might notice the chroma skew is absent in the lower right corner. There's a little footage saver in Magic Bullet and it's the shoulder. Again I made it pretty extreme in this example to show how it can remedy chroma skew.

Probably you'll grade this image like the picture above. Less contrast but not as flat as the extreme example. My point is you might have to think in a new direction sometimes if you want to achieve something that can be difficult with an 8-bit camera like the Panasonic AF101. It's better to shoot with as few artefacts as possible to start with and flatten the image to you liking afterwards.
Again, if your goal is a really flat result you'd better use a flat scene file but if you're after something that will be graded it can be worth the time to try contrasty vs flat scene file.
One has to realize this is not an Alexa and you can not expect it to be one. But there are tweaks that can make it better.