For what it may be worth, a comparison was done between CG03 and CGo3+ cameras.I also can do this setting, but after it, the camera image is freezed. I'm able to change to video, but not back to image. Than just loading in loop.
What version is your CGO3 app?
The "DNG" setting worked on both of the CGo3+ cameras.
The "DNG" setting failed to work properly on either of the CGo3 cameras.
The comparison consisted of:
(2) CGo3 cameras running V2.4.00(A) firmware.
(2) CG03+ cameras running V3.2.34(A) firmware.
Samsung Galaxy S4 Smartphone running Android version 4.3.
APP version is "CGO" V01.0.0067.
SD card is a "Netac" U-3 rated card.