I started a thread titled "Powering my E-500 for a week straight" last week, and the goal was to make an AC wall adapter to fit the E-500 / E-330 which both lack a power plug for the Olympus AC-1 Power Adapter. I plan on doing some time-lapse sequences lasting days, not hours and I needed a way to power my E-500 other than using a BLM-01.

rkrenn (Richard) gave me an interesting suggestion; Why not use the PS-LBH1 W Battery Holder as a method to feed power into the E-500.

After much discussion and some advice hunting from all the knowledgeable users on this forum, the image below is what I came up with.
(click the images for larger versions)

#1 LBH1 connected to RadioShack 2000 mA Power Supply...

#2 The construction required only the items below...

#3 I am particularly pleased with the fact that the LBH1 did not need to be modified at all! The solder-less connectors just slip right on, and I gave them a firm squeeze with the pliers...

#4 And here is the final result...

Now for the nitty gritty...

* do not do this to your camera unless you are willing to run the risk that you could very well fry the poor thing if you do it wrong. *
I am responsible for my E-500 getting fried if this doesn't work out in the long run, but if you perform this modification, you do so at your own risk. This goes without saying of course, but I still said it... So there!

The basic recipe is a 1000~2000mA AC-DC adapter. I got one at radio shack for $30. The voltage is of utmost importance and I believe that you can safely use between 7v~9v DC. My adapter goes up to 7.5v (measured 7.8 on my multi-meter) I have been told that your adapter should be 'Regulated.' The Adapter I used also has some sort of (I believe Ferrite) in-line noise suppressor at the end of the cable.
The LBH1 Battery Case is an ideal method to send the power into the camera's body without opening it [the camera] and hot-wiring it.
The rest is as simple as connecting the two components correctly.

I used some female soldier-less connectors that I picked up at RadioShack as well. (I removed the little red insulation to save space and to facilitate bending them.) Once the end of the adapter's cord was snipped with my pliers, I removed the outer insulation and separated the positive and negative wires. I then crimped the solder-less connectors onto the ends of the wires and proceeded to test the systems. Remember to work on the wire-stripping and crimping with the adapter unplugged. You do not want to create a short and burn yourself or destroy the adapter.

The Voltage coming from the 7.5v setting of the adapter was actually .3v more than stated. What is also interesting to note is that the BLM-01 actually puts out a couple more volts that it says on the battery itself. I measured my almost fully charged BLM-01 at 8.1v This gave me confidence to use the 7.5v setting on my adapter as it was within .3v of the battery I was using.

Finding the correct leads in the battery case is as simple as touching the multi-meter to the positive on the battery case (in Ohms mode) and seeing which terminal in the case it leads to. The same goes for the negative terminal. Note that the Battery case also has the (T) Terminal as the BLM-01 has and it seems that there is some sort of electrical component in the battery case itself.

Getting the polarity of the system correct I would believe is a very important step in the process. I don't even want to think of the sounds and smells that would come from the E-500 if I got this wrong. So, as before, once I connected the adapter to the battery case, I tested and tested again to make sure that the voltage and polarity matched the BLM-01.

The battery case stays put, but not as well as a BLM-01 does. It slipped out once or twice when I was testing the system, but once you handle it gently or loop a rubber band around the body to hold it in, it should stay put.

Just a note: I tried 7v(7.3 on the meter) first, and the camera gave me the low battery warning. Then I tried 7.5v(7.8 on the meter) and the camera gave no low battery icon.

The camera sounds and operates as it should and thus far I give the mission an Accomplished status.

(I'm not an electronics person. If I missed anything or got some terminology wrong, please correct me.)