So I've narrowed it down to images with a file path that leads to to wp-content/uploads. All images that are in the theme do not cause a conflict.
The weird thing is that the images in question aren't even uploaded yet. And I'm experiencing this in the back-end. Changing permissions on the cache folder only changes how the error displays, with or without an image file path. I've also tried creating a conditional statement so that if the image is empty, the image doesn't display at all, but that doesn't seem to help.
Again, my PDFs were being generated just fine. But I had been working with an example CPT that was already compiled. We discovered this problem when going to create new posts. Obviously, deactivating the plugin every we create a post is not an option! :)
TLTL: did you come up with a fix for your encoding theory?
Am also looking into the possibility of some kind of hot linking problem...waiting on a host response...