Yeah, I admit it's not the most fortunate of structures. People tend to skip over the "blah blah" at the end
Jagged outlines refers to images that have either been resized or rotated improperly. Basically, outlines should be
smooth, not choppy. Here's a visual example:
Jagged outlines can also appear when art is extracted improperly, like with the Magic Wand Tool in Photoshop. The tool
selects one color mostly, but it will usually also grab colors in that selected color's range (for example, if you have
an image where a pink and a red area are right next to each other, selecting the red area can also select part of the
pink one). Below, I extracted a character from an official artwork, then pasted her on another background:
And to clarify what JPEG artifacts mean, another visual example:
If you look around the outlines, especially on the dark purple hair, you will notice some fuzziness. That's not supposed
to be there.
Saving images at a high quality is a must, since some colors (red, especially) are sensitive to drops in quality. Saving
a mostly red image at 7 quality instead of 10, 11, or 12 will give you an image full of artifacts, like below:
Compare the red/orange areas, and the areas where the coloring meets the lineart. That fuzziness, again, is not supposed
to be there, it's a noticeable loss in quality.