Bug in url encoding/decoding?

When I use url encoding some of the css styles and images cannot be displayed, e.g some images display generated ASProxy 404 not found image.

For example: try browsing http://boards.4chan.org/tv/. There's this image in the page:

<img src="//0.thumbs.4chan.org/tv/thumb/1379570244505s.jpg" alt="1.8 MB" data-md5="/HwFV7E+adprO0Ej+MSazQ==" style="height: 140px; width: 250px;">

which becomes like this when I select Images and Encode:

<img src="images.ashx?dec=0&amp;url=http://boards.4chan.org//0.thumbs.4chan.org/tv/thumb/1379570244505s.jpg" alt="1.8 MB" data-md5="/HwFV7E+adprO0Ej+MSazQ==" style="height: 140px; width: 250px;">

which doesn't exist and displays auto-generated "error not found" image.

I debugged the source code but couldn't find out why this is happening. Any ideas?