The hole(s) in the cap act as the aperture setting like the lens on a SLR camera. It increases or decreases your depth of field. The small hole has the greatest depth of field but lets in the least amount of light. Lens cap open has the smallest depth of field and lets in the most light.
Using no lens cap or wide open is similar to the F4 aperture.
The small 1/8" opening is similar to the F22 aperture
The punch out is a compromise in the middle.
What this picture doesn't show is the same holds true in front of the object.
Depth of field
From Wikipedia, the free encyclopedia
"Focal depth" redirects here. For the seismology term, see Depth of focus (tectonics).
The area within the depth of field appears sharp, while the areas beyond the depth of field appear blurry.
In optics, particularly as it relates to film and photography, depth of field (DOF), also called focus range or effective focus range, is the distance between the nearest and farthest objects in a scene that appear acceptably sharp in an image. Although a lens can precisely focus at only one distance at a time, the decrease in sharpness is gradual on each side of the focused distance, so that within the DOF, the unsharpness is imperceptible under normal viewing conditions.
In some cases, it may be desirable to have the entire image sharp, and a large DOF is appropriate. In other cases, a small DOF may be more effective, emphasizing the subject while de-emphasizing the foreground and background. In cinematography, a large DOF is often called deep focus, and a small DOF is often called shallow focus.
Their are some guys over in the UK who have made up an adapter, removed the existing photon lens and replaced it with a camera lens are getting good results, but the warranty is voided.