Found a small bug in ImageSetPixel in functions/gd.c. See below.
It seems that this bug has been here for awhile. (Found it in php3.0b3 too)

void php3_imagesetpixel(INTERNAL_FUNCTION_PARAMETERS) {
        YYSTYPE *imarg, *xarg, *yarg, *colarg;
        gdImagePtr im;
        int col, y, x;
        int ind_type;
        GD_TLS_VARS;

        if (ARG_COUNT(ht) != 4 ||
                getParameters(ht, 4, &imarg, &xarg, &yarg, &colarg) == FAILURE)
        {
                WRONG_PARAM_COUNT;
        }

        convert_to_long(imarg);
        convert_to_long(xarg);
        convert_to_long(yarg);
        convert_to_long(colarg);

        col = colarg->value.lval;
        y = yarg->value.lval;
        x = yarg->value.lval;
/*          ^
 * In this function x and y are always == to what the user
 * entered for yarg (as you can see)
 *
 * It should be:
 *      x = xarg->value.lval;
 *********************************************************/

        im = php3_list_find(imarg->value.lval, &ind_type);
        if(!im || ind_type != GD_GLOBAL(le_gd)) {
                php3_error(E_WARNING, "Unable to find image pointer");
                RETURN_FALSE;
        }

        gdImageSetPixel(im,x,y,col);

        RETURN_TRUE;
}