Uploaded avatars are displayed in a very low quality in the combined flair.
They are displayed fine in the per-site flairs.
This bug only affects uploaded avatars. Gravatars still work fine.
The network flair is on another code path from the per-site flair, causing this issue.
A fix is in the next build, though the network flair is cached, so you will probably only see it change within 24 hours.