I am the colleague. The problem occurs when editing html pages uploaded to Moodle with the WYSIWYG editor (which can be turned on so that those modifying the pages don't have to use html editor). As Ernest has described, the location string for the images changes when using Internet Explorer, but not Firefox. The only think that Firefox changes is if there are quotation marks (") in the html page, they get converted to the 'gobble-di-gook' images, and these then have to be reinstalled by hand.
I have attached an image that shows the difference between the code on the html, and the code of the html in the wysiwyg editor. You will note the distinction at the top of each window with the src=....
