Not true. If you specify the Content-Encoding headers, Chrome and Firefox decode and display the images properly.
http://en.wikipedia.org/wiki/List_of_HTTP_header_fields#Comm...
Source:
<?php
header('Content-Encoding: gzip');
header('Content-Type: image/jpeg');
$fin = fopen('test.jpg', "rb");
$fout = fopen('php://output', "w");
$gzipFilter = stream_filter_append($fout, 'zlib.deflate', STREAM_FILTER_WRITE, array('level' => 6, 'window' => 15, 'memory' => 9));
stream_copy_to_stream($fin, $fout);
stream_filter_remove($gzipFilter);
fclose($fin);
fclose($fout);
To see Chrome decode your test image, use gzencode() or set Content-Encoding to deflate.
http://www.thestudentcloud.co.uk/hn/test2.php
<?php
header('Content-Encoding: gzip');
header('Content-Type: image/jpeg');
$data = file_get_contents('test.jpg');
$gzdata = gzencode($data, 9);
$fout = fopen('php://output', "w");
fwrite($fout, $gzdata);
fclose($fout);