The alkalinity of developer solutions tends to increase the clumping of grain. Because Rodinal is a high alkaline developer, higher dilutions reduce the alkalinity of the solution and hence reduce clumping of grain (what we perceive as increased grain). Note however, that a higher dilution also increases the development time, which for some films can increase grain clumping. The more modern emulsions are generally less susceptible to increased grain clumping with increased development time.(posted 8434 days ago)The Rodinal dilution effect is different than most other developers (D76, XTOL, and many others) that contain sodium sulfite, a grain- reducing chemical (via its solvent action on the grain). For these developers, a higher dilution increases apparent grain due to the lower concentration of the sodium sulfite solvent action.
As with almost all developers, increasing the dilution of Rodinal has a compensating effect (decrease) on the contrast of the negative. However this compensating effect assumes normal agitation procedures. The use of overly vigorous or continuous agitation can offset or eliminate this compensating effect.
As mentioned in the post above, the higher dilutions can also increase apparent acutance by increase the edge effect of adjacent areas of contrasting density. There is some controversy as to whether this occurs because of the higher dilutions (the highlight areas of the negative exhaust the developer more quickly than the shadows), or whether it is a characteristic of developers (e.g., Rodinal) that exclude grain-dissolving agents such as sodium sulfite. Obviously, if the first theory is true, this effect will be negated by over agitation.
I would recommend that if using slow to medium speed films (ISO 25- 125); dilutions of 1:75 and 1:100 can be used for high contrast scenes; and dilutions of 1:25 and 1:50 can be used for low to moderate contrast scenes. I have no experience with dilutions more than 1:100.