As you state, the first GRD version had very slow DNG write times, and some users thought that the noise of the JPGs, say, at ISO 800 was very film like. There may be another factor, when the GRD first came out — was it 2005 or 2006? — many users didn't know how to process raw files and may not have had have owned Photoshop, which was still the main software for image edition, and was expensive. In any case, the original GRD developed a cult status with, in my view, an element of myth of the filmfike qualitiy of the JPGs that still persists today among some people.
When I got the GRD in mid-2006, I started using JPG for I didn't know what raw files were; but that didn't last more than 50 frames and I moved on to DNGs, which have the advantages that I am sure you know (despite the long write time on the original GRD). These days I only shoot JPGs witht the GRD4 when using the high-contrast mode, which is availbale only in JPGS.
In going to from the GRD to the GRD2 and GRD3, image qquality of the DNGs improved about one stop in each version, and the improvement in the GRD4 ovr the GRD3 is still 1/2–3/4 stop. My advice would be to get the GRD4 if you are serious about this camera. Also, the 21mm EFOV wide-converter is excellent, as it preserves the f/1.9 maximum aperture and the image quality. Where else can you get an f/1.9 21mm lens at about US$150?
I should mention, however, that when I went from the GRD to the GRD2 I was initially disappointed that the grain and some of roughness "was lost" ± under I learnt how to "destroy" or rough up files. After that, I appreciated the improvement of image quality of each version of the camera because it gave me more scope for processing. The first picture below is a favorite of mine, but has not been popular on flickr. The second on the oother hand has had more views, comments and favorites of any of my shots but of which I am not that fond. The third one I like but it's not popular.
Ricoh GRD3 | 21mm wide-converter | ISO 400 | f/1/9
Bangkok
Ricoh GRD2
Paris
Ricog GRD3
Bangkok
—Mitch/Bangkok
Bangkok Hysteria (download link for book project)