Nope, I don't know it even slightly for sure. Mirage's point is valid, and if someone presented both hypotheses to me for the first time now, I'd think that whoever came up with mine was on drugs. It's just what I always thought, but I also always thought it was a bit ridiculous.

Note that even if my hypothesis were true, it wouldn't mean that a sig image would be degraded, since the image that is displayed on a client monitor is downloaded to their computer first, not opened on the server. Also, you'd need to do it a stupid number of times. Like, and unbelievable number.

Tiff is good for anything really, but not great. PNG is fantastic at being a good image format.