1) Not necessarily, you may not even need progressive rendering if sprite batches bring it down to a manageable number of concurrent requests, right?

2) How is it any more work to encode? It's the same total number of pixels and the memory footprint isn't that large for server or client.

I don't mean to dis your efforts, looks like you've done some nice work that performs well.

I just think cloud/media management is an interesting problem with a lot of different ways to look at it.