I used a utility program (convert, from the ImageMagick package, on a 
gnu-linux system) to create copies of a jpeg file in different sizes. 
I display them like this:

      (insert-image (create-image "rms50.jpeg") (point))

Using another utility program (display, from the same package) the 
pictures all look right.  The files also all seem to be of 
appropriate sizes.

     1259 Jan 30 18:42 rms10.jpeg
     4420 Jan 30 18:49 rms25.jpeg
   12833 Jan 30 18:49 rms50.jpeg
   13345 Jan 30 18:53 rms51.jpeg
   25729 Jan 30 18:49 rms75.jpeg
   39173 Jan 30 18:49 rms100.jpeg

The 10%, 25%, 51%, 75% and 100% scale image display properly using 
create-image and insert-image as shown above.  But the 50% scale 
image image displays the same size as the 100% image.

The 50%, 51% and 100% jpeg files are attached.

--Greg