In .Net framework 1.0 and 1.1, fusion is not able to download
assemblies hosted in web servers with http compression enabled.
This is a bug in fusion, and it has been fixed in .Net framework 2.0.
We may backport the fix to 1.0 and 1.1, depending on the demand. The
fix is non-trivial and affects all http assembly download case. Which means it
has a high probability of regression.
Until then, please consider Deploying assemblies using cab files. It
gives a much better compression ratio. And it works in all versions of .Net
framework.