My definition of Jpg (Compression) artifacts is (see picture, the image below)
Just remembered, what firmware are you running ? Setup > About > Device Info
Because, older firmware displayed the images from cache (which can overcompress the image)
Latest Firmware displays the image from the local file, as evidence, PNG’s with alpha tranparency trick works again (the image is never cached)
http://community.wd.com/t5/WD-TV-Themes/Transparent-PNG-s-they-re-back/td-p/846148
These 2 screenshops were captured using the WDTV “Capture Snapshot” feature … and i cannot see compression artifacts
P.S. i have a 2014 WDTV FW 1.02.17 … screenshot shows me streaming from the Live Hub