I think Daanh is talking about the DOF preview that is supposed to show you what will be in focus, and what will be blurred. Out of curiousity, I also assigned that function to the Fn button. I tried it, and I can't quite figure out what it's supposed to do. When you push the button, the picture on the LCD shifts or "jumps" a little, but you really can't see what the DOF will be. I remember using that same function on a film SLR, and I was equally nonplussed by it, because it just caused the viewfinder to get very dark. The E-PL1 shows what DOF will be when you push the shutter button halfway down, but it's often hard for me to see it clearly, depending on the lighting. I had sort of the same concern Daanh does, so I went into the most brightly-lit room in the house (the kitchen), focused on the tip of the faucet, pushed the shutter button halfway, and was able to see the depth of field very clearly. The tip of the faucet was in focus, and everything behind it was blurred.
Hi, let me clarify: when you press the shutter button halfway, the aperture opens shortly to it's assigend setting, but closes almost immediately. So you get a short preview of the depth of field that you will get. With the preview button assigned, the aperture opens as long as you press the button, so you can see the depth of field longer. I just don't understand why the aperture isn't always opened to the assigned setting.
On my E-P2 the DOF preview works just like I would expect it. Stop down to f5.6 or f8 and watch the front of your lens when you press and hold the button. The aperture stops down to what you have set it. This gives you a live preview of what the actual DOF will be at that aperture.