I was wondering why there were LED cutouts too, and found out it was smart for them to do so -- the flash would likely result in internal light refraction within the screen protector causing image degradation. In other words, with it on, if you put your thumb over the LED flash with the light on, you'll see the screen protector's edges light up, as there is some internal light reflectance going on.
This is exactly why. My homemade camera screen protector does not have any cutouts for the flash and, when it's used, results in these internal reflections, causing the image to be washed out.
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