I have fixed the decal/faces and stretched them how they should be
I have added some experimental commands you can apply to your images that may improve quality
&inverthack_decal=1&inverthack_face=1when decals or faces are copied onto certain colored surfaces you may get strange white artifacts, these are meant to combat this but it can affect the quality of the decal/face so these should only be applied if your face or decal has white artifacts
for example here is a before and after on Masterlegodude's avatar:

it has some notable affect on the quality of the decal but looks better than the version with white pixels all over it so use these if needed until I find a way to completely remove this issue which mainly lies in the php image library