apache mod_deflate doesn't work with IE 7

Solution 1:

This would be the problem. You are explicitly telling it not to gzip for MSIE (Microsoft Internet Explorer) browsers.

"BrowserMatch bMSIE !no-gzip !gzip-only-text/html"

Looks like you are using the default rules. MSIE 5.5 and 6 had problem with gzip for which the fix was to not zip the content when serving to those browsers.

The link below should help you understand it better.

http://sebduggan.com/posts/ie6-gzip-bug-solved-using-isapi-rewrite

Solution 2:

You can fix this very easily be having it match everything under 7; replace your match with:

BrowserMatch \bMSIE\s7  !no-gzip !gzip-only-text/html

This will keep it enabled for IE7 and on.