The problem is described here:

http://curl.haxx.se/mail/lib-2006-04/0046.html

I successfully tracked the problem to the "Connection:" header. It seems that
if the "Connection: keep-alive" request header is not sent the server will
respond with data which is not chunked . It will still reply with a
"Transfer-Encoding: chunked" response header though.
I don't think this behavior is normal and it is not a cURL problem. I'll
consider the case closed but if somebody wants to make something about it I
can send additional info and test it further.

The workaround is simple: have curl use HTTP version 1.0 instead of 1.1.

In PHP, add this:

curl_setopt($curl_handle, CURLOPT_HTTP_VERSION, CURL_HTTP_VERSION_1_0 );