The nonlinear common path interferometer is a simple and robust single lens optical processor using an intensity dependent medium placed on its geometrical focal plane to observe deformed w avefronts. I t is described either as a nonlinear interferometer or as an image processor. We demonstrate that this system requires excess surrounding illumination beyond the geometrical boundaries of the disturbance to operate. We discuss recent progress on this setup. In particular, the effect oflarge phase changes in the filter and the dynamics ofthe filter formation.