"Try some," says Rosie Paul, taking a plastic bottle from the fridge and holding it up to the light. It looks different, certainly: butter-yellow, not chalk-white. The top quarter (or thereabouts) seems somehow more solid; that's a hell of a cream line. Rosie upends the bottle a couple of times, gently mixing the contents. And fills a glass.

The taste is spectacular. Smooth, silky, unctuous. Sweet almost, but not in the least rich, and with a body to it that's a world away from its anaemic processed cousin. If you drink it regularly, says Rosie, it tastes different every time: it changes with the season, with the weather, with what bit of the farm the cows are grazing, whether they've had a bit of clover or snaffled some wild garlic from the hedge. It's milk, but not as we know it.

And what do we do with the vast majority of it? "It's as if," says Rosie, "we took a bunch of fine wines, each with their own unique flavour and aroma, then processed them and mixed them all up together so they all smelt and tasted the same. We take a really good product – raw milk – and we make it awful."

Rosie and her husband Dave, a third-generation dairy farmer, have 180 Guernsey cows (the breed is important; more on that later) on 250 acres in Somerset. Some 75% of their milk is bought by a dairy, where it will be heated to 72C for 15-20 seconds to kill off potentially harmful micro-organisms (pasteurised), and most likely homogenised. Mixed with milk from other farms, it is then forced through small holes to break up the fat globules and spread them evenly through the milk, preventing separation.

But like fewer than 200 other farms around England and Wales (distribution of raw milk is illegal in Scotland), a growing proportion of the Pauls' milk is sold raw: maybe 10% now, Dave reckons (the remainder is used mainly for unpasteurised cream and yoghurt). Every Saturday, Dave loads up a truck with Hurdlebrook raw milk and cream to sell at Islington, Notting Hill and Marylebone farmers' markets in London; the couple also sell from the farm, at selected local markets and by mail order.

Demand is rising, he says: "At first it was the older generation, who remembered what real milk tasted like. Now it's younger people, interested in authentic, unprocessed foods. But you do need an urban customer base to make it viable."

Sales of raw milk are strictly regulated: producers must sell direct to consumers, not through shops or supermarkets; bottles must carry a health warning; and environmental health officers "really put you through the hoops," says Rosie. Hygiene must be irreproachable.

Despite huge advances in refrigeration and hygiene since we started pasteurising everything, raw milk still worries us. The Food Standards Authority says bluntly it may contain bacteria "such as salmonella and E coli that can cause illness". In practice, says Dave, who never drinks any other kind, raw milk today is produced in clinically clean conditions, goes "from teat to tank" without contacting the air, and is cooled to 4C within five minutes. The risk is minimal.

The health benefits, meanwhile, could be substantial. Besides tasting better, raw milk's proponents argue it is more nutritious, higher in vitamins, healthy enzymes and "good" bacteria than pasteurised milk. Studies have shown it can significantly reduce allergies. Most also comes from small, grass-fed herds far less likely to suffer from infections and illness than factory cattle kept on concrete and fed grain by industrial-scale dairies.

In the case of traditional breeds such as Guernseys and Jerseys, it is probably also more digestible. This is relatively recent and still disputed science, but the commonest type of milk in Britain (bar the Channel Islands), the US, and much of Europe bar France is produced by black-and-white Friesian and Holstein cattle and contains a type of protein known as A1. Traditional breeds and cows in Africa and Asia tend to produce A2 milk, as do horses, goats, buffalo – and humans.

Hygiene aside, we have been sold the myth that milk is full of fat: a dairy industry delighted to sell its raw material twice (as "healthy" skimmed milk, and the skimmed-off cream) has somehow convinced us that whole milk is not good for us. "When you ask them, people often say whole or full-fat milk is 20% or more fat," says Nick Barnard of the natural foods company Rude Health, who is so convinced by raw milk he runs blind tastings at food festivals.

"In fact, it's less than 4%. Milk is not a fatty product. It's been blended, homogenised, pasteurised, standardised, demonised. Milk looks and tastes the same wherever and whenever you buy it – like some kind of anonymous white water. Whereas it's a wonderful, richly differentiated, naturally nutritious foodstuff. It's a travesty."