Wikipedia sez “Since Windows XP, if a non-BMP image is used as Windows Desktop wallpaper, Windows will convert non-BMP image to BMP image in background.” and Group Policy has some relevant options:
“Enable Active Desktop” (“ForceActiveDesktopOn”) https://admx.help/?Category=Windows_11_2022&Policy=Microsoft... has the description “Allows HTML and JPEG Wallpaper”.
Also “Allow only bitmapped wallpaper” (“NoHTMLPaper”) option: https://admx.help/?Category=Windows_11_2022&Policy=Microsoft...
“If users select files with other image formats, such as JPEG, GIF, PNG, or HTML, through the Browse button on the Desktop tab, the wallpaper does not load. Files that are autoconverted to a .bmp format, such as JPEG, GIF, and PNG, can be set as Wallpaper by right-clicking the image and selecting "Set as Wallpaper".”
Both “Supported on: Windows Server 2003, Windows XP, and Windows 2000 only”.
It's because Active Desktop was essentially running an instance of Internet Explorer rendering to your desktop, of course it's slow and memory intensive.
Disabling Active Desktop and the fancy views on the left pane of Windows Explorer made Windows 98 change from quite slow to super responsive.
Crazy times.
IIRC I had (at my first job, at the age of like 12) a bunch of constantly moving mechwarrior gifs on my desktop. Timberwolf and Vulture for sure.
I still do it out of habit with SSDs and I imagine it's mostly unnecessary but never ran into issues. I figure at worst it may increase the life of the SSD
After Dark allowed everything.