I was pretty excited to see an update to WP-Cache. The first thing I noticed is that when I enabled the new super cache compression option, I started getting a file save as dialog instead of my pages. As of the current version of WP-Super-Cache, the readme.txt file states that if you get this, you need to disable the super cache compression option.

Not being satisfied with this answer, I've done a little digging and come up with the following solution.

To serve gzipped pages to a browser, you have to have the following HTTP headers in the response:
Content-Type: text/html
Content-Encoding: gzip

The problem is that the default content headers that my Apache server were sending for the file extension .gz were:

Content-Type: application/x-gzip

I didn't want to override the default types for other sites or files I may host, so I created a Location element that applies to the wp-super-cache directory:

<Location /wp-content/cache/supercache/>
AddEncoding x-gzip .gz
AddType text/html .gz
</Location>

The .htaccess requirements are covered in the readme.txt file for the plugin but the options tab only shows you 1/2 of what you need. Your new .htaccess file should look like this:

<IfModule mod_rewrite.c>
RewriteEngine On
# this part handles browsers that accept gzip compression
RewriteCond %{HTTP_COOKIE} !^.*comment_author_.*$
RewriteCond %{HTTP_COOKIE} !^.*wordpressuser.*$
RewriteCond %{HTTP_COOKIE} !^.*wp-postpass_.*$
RewriteCond %{HTTP:Accept-Encoding} gzip
RewriteCond %{DOCUMENT_ROOT}/wp-content/cache/supercache/%{HTTP_HOST}/$1index.html.gz -f
RewriteRule ^(.*) /wp-content/cache/supercache/%{HTTP_HOST}/$1index.html.gz [L]
#this part handles browsers that don't accept gzip compression
RewriteCond %{HTTP_COOKIE} !^.*comment_author_.*$
RewriteCond %{HTTP_COOKIE} !^.*wordpressuser.*$
RewriteCond %{HTTP_COOKIE} !^.*wp-postpass_.*$
RewriteCond %{DOCUMENT_ROOT}/wp-content/cache/supercache/%{HTTP_HOST}/$1index.html -f
RewriteRule ^(.*) /wp-content/cache/supercache/%{HTTP_HOST}/$1index.html [L]
# the original rules must follow the supercache rules
RewriteBase /
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>

There. All working. If it isn't working for someone, let me know! I've tried recent versions of Safari, FireFox and Internet Explorer. You should be able to see the text "super cache gz" at the bottom of the source page if this is working correctly.

UPDATE: Donncha has integrated the headers into a .htaccess file inside the cache directory in the development version of the plugin. If you upgrade to that, you don't need to make these changes and it appears to be working properly. Thanks Donncha!