She is quite correct. Essentially there are two sorts of image file:
LOSSLESS: TIFF, BMP, various others: open a TIFF file, make a small change, save it. The []only[/i] think that is different is the change you made yourself. You can open, edit, save 100 times over and it doesn't matter - the picture quality remains exactly as good as it was in the first place. (Unless you messed something up yourself.)
Problem: all the lossless file formats are huge, slow, clumsy great things that take up a heap of space and are impractical for many purposes.
LOSSY: JPG, PNG, GIF, various others: When you save the file, the saving process throws away as much of the leftover near-useless information as it can, and only saves the most important bits (in the hope that you won't be able to see any difference, because your eye is only human). This saves an enormous amount of space and makes it practical (for example) to have pictures on the internet - if all we had were TIFFS or BMPs, our broadband connections would cost five times as much and go slower than dialup.
Problem: some information is thrown away every time you save the file. So, if you start with a ficture and crop it, then save as a JPG, then adjust the brightness and save, then resize, and so on (and this is exactly what you do when you are preparing an image - go through a whole series of steps, saving as you go so that if you mess up you can go back one or two steps and try again), what happens is that the small, not-really-noticable image quality degredation you started with is repeated over and over, and you wind up with a very small file with hardly any detail.
Solution: Save as you go using a LOSSLESS format such as BMP or TIFF. When you are happy with the final image, then save as JPG. Throw away all your intermediate saved TIFFS to reclaim the wasted space. (Keep the final TIFF if you have the room for it - you might want to make another, different JPG later - in a different resolution, for example - but use a small, fast, almost-as-good JPG copy of it for everyday purposes such as a screensaver of to post here.)
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