If you don't let the GR lens retract then you won't announce anything to observers - they have no way of knowing whether the camera is off or on because only a fellow GR user would know that the lens retracts. Just keep the camera on when actively involved in shooting, and don't make it super obvious if you need to turn it on around a subject.
I'd consider the XF10 a lot closer if it had the same character in its output, the same ease of one-handed control and fluidity, and the same IBIS and MOST importantly the REAL snap focus. XF10's hamstrung snap mode is a pain in the neck and not even remotely like the GR's with its lack of aperture control and the reliance on touch screen gestures is also not something that works for me.
Believe it or not I'd love a $450, i.e. half price, equivalent of the GR, it's just that the XF10 takes out everything that makes me love the GR. It's not that I'm so nuts about a 28mm focal length or an LCD-only camera, or even quite how small the size is. It's the DNA of the GR that suits me so well.