I've got a 725sw and I don't know how to read manuals so I've shot underwater pics in wide 1, wide 2, and underwater snapshot without any housing. Half the time the camera's dragging in the water from a zinger. I figured it says waterproof and shockproof on the housing so all I have to do is make sure the battery and card access is secure and keep the camera attached to my person. I love the camera and have had no problems with it. Helpful hint: don't spill your drink anywhere near the shutter cover - it'll stick and won't function properly until all that sticky stuff is rinsed well.
lx-88 is right. Changing the setting isn't going to make the camera not-waterproof. I've got the 720, and know what you're talking about it stating the part about the housing. I don't know what it's talking about. But like I said, putting it on action or landscape or whatever isn't going to make the camera all of a sudden unwaterproofed. I can't remember what setting I have it on, but in all reality, for a point and shoot camera with a puny 3x zoom, the difference is rather negligible. I'm sure the camera may actually make adjustments as far as SS and f-stop, but with a lens and depth of field and focus it has, the difference between portrait and landscape and so on is unnoticable. It might have the RAW filters for flourescent lighting and the such, but I've never taken a picture of a fish under lights. Maybe I'm biased, in that I'm use to the true adjustability of my DSLR. Now I'm rambling.
Don't worry about it. Just put it under water and take a picture!
a flash set to -5 stop below ambient light levels is your friend underwater. I dont know if u can adjust that on there though, so i will just say this... TURN ON THE FLASH when u shoot underwater, unless it is very bright and sunny. even then the flash wont hurt.
Just be sure to hold the camera far enough away from the fish, as flash in lower light conditions underwater will flare and glare the fish, and blacken everything else. That's common to pics taken above water too, but flash will sometimes pick up bubbles and sediment in less than clear water. I've lost some pics that would have been winners because flash killed it. But no flash would've been too dark. Just like taking pics anywhere, I'll take several upon several in an effort to at least get one good one.
I recently bought a Stylus 725 with visions of taking lots of underwater shots. So far I have taken lots of fish pictures but have not dunked it yet to do so. I bought mine at Costco and they had a phone number to ask for technical advice. From what I recall after reading the manual, I agree with most so far in that you don't need to be in a special mode for it to be water proof but rather those water proof modes will likely provide the best results for taking underwater shots. No experience with the video mode yet. Funny thing is the salesperson at Costco tried to convince me the silicone sleeve accessory that came with the camera "made" it water proof even though there was holes in it. Luckily some good advice from this forum made me know better.