[DaiPlusPlus]

Windows handles wallpapers specially and always transcodes wallpaper images to JPEG (I think the default in Windows 7 was at 60% quality setting) even when the source image was PNG - or when a PNG version would be both smaller and have less errors than the JPEG version. There’s a registry setting you can tweak to change the quality and I think you can configure it to not transcode PNG images now - but I don’t think it’s the default.

As for the reason why - I think it’s to do with users using high-res photos (like 10megapixel) as wallpapers which would bog Windows down if used as-is - and users on roaming profiles causing a 10MB+ BMP image bring copied over the network every time they logon. Probably. I speculate.

[ComputerGuru]

    HKCU\Control Panel\Desktop\JPEGImportQuality -> 100

[Razengan]

macOS has been using 10-bit 5K wallpapers worth tens of megabytes at full quality for years now.

[colejohnson66]

But they cache them as a GPU texture, don’t they?

[DaiPlusPlus]

Windows does something similar now too. It used to be that USER32 (which owned the windowing system/window manager since Windows 95) would render the wallpaper - but ever since a semi-recent release - either Windows 8 or Windows 10, Explorer.exe became responsible for rendering the wallpaper - and there's definitely some tie-in with the DWM too (you can see this because whenever you kill your session's explorer.exe your desktop wallpaper will disappear). I'm curious what goes on, exactly.