Hi there javawillie,
You may not be far off...
... I am actually using CVS....just set up my own local CVS pserver on my OS X machine today!
I've tried changing Eclipse's settings so that instead of automatic file type detection it reverts to -kb - the binary type. I commited and updated changes, but this made no difference with regard to my problem...
... One of the things that is puzzling me is that, most but not all sprites are garbled. And if I create any new ones from scratch on my OS X machine, it works sometimes and not others...
Here is an example of what my ship sprite currently looks like: (nice hey!)

Regards,
Ribot
Long shot, but if you are using CVS then make sure you're using the -kb flag for importing. Not doing that sometimes produces the result you describe. (You're probably not doing that, but just in case...)