The image on the right of bristlecone pines on the Arapahoe Glacier trail is one of my favorites. But it doesn't look very promising straight out of the Canon FS4000US scanner (top right). The reason is that the sky is extremely bright, and the scanner software sets the brightness levels to maintain detail in the brightest and darkest parts of the image. As a result, most of the tonal range is occupied by the sky-- foreground tones are dark and compressed. (April 2002. The original scan came out quite a bit better with the latest version of Canon's FilmGet software, 1.0.3.)
The image is edited (middle right) using the mask (bottom right) to adjust the foreground and sky separately. Foreground tones are brought up to the desired brightness and color. In a 24-bit (8 bits = 256 levels per channel) color file, grayscale levels-- tonal detail-- would have been lost in the dark compressed foreground; the adjusted image would have had a roughness to its colors. For example, levels 78, 79 and 80 might all be transformed to level 167. This doesn't happen to every level, but it must happen to some levels. There is no loss of scan detail in a 48-bit (16 bits = 65536 levels per channel) color file. It maintains its tonal detail when it's adjusted.
Once these adjustments are complete the file may be saved as 24-bit color or 8 bit B&W without loss of quality. Many editors can't work in 48-bit precision, for example Photoshop LE, the "lite" version supplied with many scanners, and Photoshop Elements. Two that can are Photoshop (the full version, 6.0+) and Picture Window Pro (my favorite).
Inkjetart.com has a particularly nice three part article illustrating the advantages of 48-bit editing. Color Management guru Bruce Fraser has excellent articles on the advantages of 48-bit editing and on Photoshop's 48-bit limitations.