As the number of shades of gray in an image increases, dithering artifacts become less and less noticeable. Can you tell which side of the image is dithered and which is not?
Because the code for this algorithm is fairly complex, I'm going to refer you to the download for details. Simply open the Grayscale.frm file in your text editor of choice, then find the drawGrayscaleCustomShadesDithered sub. It has all the gory details, with comments.
Conclusion
If you're reading this from a slow Internet connection, I apologize for the image-heavy nature of this article. Unfortunately, the only way to really demonstrate all these grayscale techniques is by showing many examples!
The source code for this project, like all image processing code on this site, runs in real-time. The GUI is simple and streamlined, automatically hiding and displaying relevant user-adjustable options as you click through the various algorithms: