I enabled the compression option on WP Super Cache (off by default!) on my blog. After that, Website Optimization started identifying my pages as being compressed (before, it didn't).
All seemed well with the world, but then I double checked with Page Speed Firefox plugin, and and sniffed the traffic with Wireshark, and according to both these measures my page is not compressed.
Are my pages being compressed or not? Could it be some proxy my ISP is running, that does not support compression? (that would explain some of the horrible internet experience I'm getting).
Here are the HTTP headers I'm seeing with wireshark.