I discovered this flaw with the camera the day after i bought my E71.
To emulate this problem, change the camera settings to 1mb then try zoom to about 50% - 80% then try taking shots within this range.
In 0.3mb range it comes out if you use maximum zoom with extended zoom activated.
I went to incomm today to help a friend get his hands on a unit. They have four units in stock then, so we tested the camera to see if it was the same problem.
Apparently all the units have the same problem. The sales rep was shocked to see this result. She then called-in the service peeps and apparently they are not aware of any problem with the phone. Rightly so because i did some research after i discovered this problem and there was no article on blogs or reviewers about this particular problem. I figured that nobody knows about it so i wanted to get the word out. So obvious the service peeps an incomm won’t know about this problem simply because nokia themselves are problem not aware of such problem.
It looks to me that its not a hardware problem. Probably just a software problem with the camera. This is because when you look at the image before you take the picture its fine but after the camera shutter captures the image it cannot display it.
I have got some response about it after having posted this problem in some forums that everybody else out there in the world is also experiencing the same problem. So just so every Nokia E71 owner out there knows that there is a glitch on the camera side.
If you use the 2MB and 3MB settings for the camera its fine. Just the 1MB and 0.3MB settings are having problems so far as i know.