This thread contains the most information I've been able to find about this: #986558: "Aggregate and compress CSS files" and "Aggregate JavaScript files" in performance settings, is not working
I have 2 d7 sites. One is in public_html/ on my server and has no problems. The other is in a sub-directory, and breaks when turning on Aggregation/Compression of css & js files (in admin/config/development/performance ).
When I turn on js performance, my js doesn't work. When I turn on css performance, no css loads on my site in Firefox or Chrome, but does load in Safari. According the the above-mention issue, it's because of Drupal & my server sending compressed info to the browser, which can't decompress it and thus, I get no js or css.
Following a recommendation, I disabled these in my .htaccess file:
#Header append Content-Encoding gzip
#Header append Vary Accept-Encoding
What that did, however, was break some of my css, and load a "skip to content" area in the top of my website (which, if you do theming, you might be familiar with seeing that as a hidden html element that is loaded).
I'm not sure what to do to fix this. I encountered it the first time I built this site, but was using D7-rc1. I rebuilt it hoping new core/module updates would fix it, but this site is running on D7.7 now.
Please help. Thanks.