The LVF2 is what the LVF1 should have been back in 2009 for the GF1. For some reason Panasonic said it couldn't be done at the time even though rival Olympus peddled a much better EVF for their PEN cameras.
Flash forward to now, and I can finally say I'm satisfied! The LVF2 is exactly like the EVF found in the G1 and GH1 I've owned. It's got the same characteristics as the EVF in both those cameras. It is physically larger than the LVF1, and I wish Panasonic had incorporated an eye sensor like the G1 and GH1, but, the button to toggle between the LCD and LVF is in a much better location than on the LVF1.
The diopter adjustment is in a really clever location too, it won't be changed by accident while using the camera in the normal position.
March 13, 2013 Update: The LVF2 is compatible with the Panasonic Lumix LX7. While looking for a great compact camera to replace my Canon S90, the LX5 arrived and was compatible with the LVF1. Knowing that the LVF1 was far from the quality I was used to with the G1, GH1 and later the GH2, I decided to wait and I'm glad I did. Since the LVF2 was introduced with the GX1, I figured the next LX camera would feature LVF2 compatibility and it of course did. With the LX7 you can have compact size with the added stability of using a viewfinder.