The differences in behavior between web and mobile versions are known, and at the time they were designed, catering to user needs or platform realities for each type of environment.
The quality setting used for file saving is another design choice that purposely allows for smaller file size (in bytes). Many iPhone and iPad users of Photoshop Express rely on our app to make quick edits before uploading and sharing. Some users rely on 3G connectivity, and prefer smaller file size (in bytes) for faster uploading.
Regarding the last issue you mentioned, it sounds like Photoshop Express is processing the thumbnail and not the original RAW image. Some cameras have a setting to record an image in RAW + Jpeg formats simultaneously. If this is possible for you, please try this approach. Otherwise, I recommend you use iTunes--import you pictures into iTunes (which will convert the images to a size and format appropriate for Photoshop Express), and then sync them to your device.
Thanks very much for your thoughtful and insightful feedback on Photoshop Express! Feedback like yours is valuable, as it helps us understand the evolving needs of our users. If you haven't done so already, please make sure you post your feature requests for quality and resolution preservation when editing files here: https://www.adobe.com/cfusion/mmform/index.cfm?name=wishform. This will really help raise the visibility of your request.
Thanks,
Charlie
