You should think of the RAW format as a negative and the JPG as a processed photograph.
In the end you require a processed image for stitching but in no way is a camera processed JPG a desirable image.
Your processed images should be output as a (non lossy) format. I.E: 16bit TIF format. JPG format is a lossy format meaning each time it is processed and saved it losses vital information and thus deteriorates somewhat.
The biggest thing to effect images shot with a fisheye lens (outside of distortion) is chromatic aberration (CA) sometimes called colour fringing or colour shift. Whilst it is an easy thing to correct with RAW processing software the camera itself does a very poor job of this when prossesing a crappy JPG.
Without getting into a full tutorial about processing RAW files the bottom line is that RAW is the best way to shoot and JPG should be avoided. That said, if you don't learn how to process a RAW file properly you are wasting your time anyway.
Simply, if you are not shooting RAW and processing the RAW file correctly you are not getting the most from your equipment. Anyone who states differently simply lacks expert knowledge and doesn't know how to process images.
It is possible for the camera to be set to capture both RAW and JPG at the same time. Why this is useful is because you can quickly view the JPG images in an image viewer and maybe even quickly stitch the much smaller JPG files to see if processing the RAW files is worthwhile or if they should simply be discarded.
With my D300 I run Sandisk Ducati Edition UMDA Compact Flash cards with a 45mb/Sec 300x write speed. Understand these speeds that they quote are a maximum speed and rarely reached.