As laid out in RFC 7230 section 3.3.3 Content-Length must be ignored if any Transfer-Encoding is present in the response. Not only chunked like curl behaves now.

As the spec (clarified like this long after curl's initial implementation) says

If a Transfer-Encoding header field is present in a response and the chunked transfer coding is not the final encoding,
the message body length is determined by reading the connection until it is closed by the server.

Transfer-Encoding for anything else but chunked is rarely used, which is probably why this hasn't been reported earlier.

Right now, curl acknowledges and uses the content-length as the size of the compressed presentation in the body.