Except for the little mess up in one scene, it is practically the same quality
as the R2 version, though with slightly less bit rate. R1 might even be a bit
sharper, which isn't necessarily a good thing given the high-contrast
cell-less animation. It doesn't seem to have edge enhancement, so
that's good.
On the other hand, R2 DVD is physically far superior. Most people
take the silk-screening for granted. The truth is, the silk-screening
can cost more than the rest of the disc. R1 DVD is certainly not a
bad attempt at it. R1 silk-screen is high-quality 2-layer design with
some clever use of the empty layer. It's fairly common for companies
to use the empty layer to express things because it doesn't cost any
extra.
Now, R2, it is made up of at least 10 colors, however, it is probably
not layered. The real kicker is that it is not a silk-screen, in the
common use of the word anyway. It exists right on top of the
reflective layer _inside_ the disc. This means, they had to specially
manufacture the discs by having the drawing put on the top of the
reflective layer (or under the top polymer layer) during the disc
manufacturing. I can't imagine it being a cheap process. The end
result is far superior to any standard silk-screened disc. It seems
to be associated with the animation director Yanagisawa Tetsuya-san.
The only other anime DVD with this type of construction that I know of
is I-My-Me! Strawberry Egg DVDs.
Anyway, enough babbling. Here're some images:
Image1: R1/R2 image comparison at the point where R1 is having dark
vertical band problems.
Image2: R1 silk-screen. It's good, just not exceptional in any way.
Note how May is drawn by empty layer.
Image3: R2 DVD. Exceptional!