I have a very well tested module in my framework (ie: running in production environments for a couple of years) called 'fastpage', which takes care of both memcaching and gzipping for frequently requested content. It memcaches one version of each unique page both gzipped and non-gzipped, and returns the appropriate version based upon the browser's Accept-encoding header.
$page_spec = array($dependent,$variables,$go,$here);
... make page here ...
The only fix I can find right now is to disable gzip entirely for this browser. User agent string is: Mozilla/4.0 (compatible; MSIE 8.0; Windows NT 5.1; Trident/4.0; .NET CLR 2.0.50727
The same output works fine in firefox (windows, linux, mac), and in safari.
Versions are: zlib 1.2.3-r1 / php 5.2.6-r7 / lighttpd 1.4.20
So much for the 'this has been fixed in IE7' comment, above...