That probably refers to the iPhone's options on sending a scaled version of the images it takes.

Windows Live Mail (the desktop client formerly known as Outlook Express) also offers resizing options when sending.

Lotus Notes.

I thought Notes only compresses/resizes inline graphics -- ie if you paste a screenshot into the email it will resize it -- but attachments it leaves alone. Could be wrong though.

When I go to attach an attachment, there is a box which is automatically checked as "compress". Apparently it can be set as the default with no option to change it by the user by an admin who doesn't want everyone sending large files all the time on a corporate network.

My impression was that was the equivalent of turning on gzip compression on a website.. reduced bandwidth but didn't affect what you were actually sending. Could be wrong.