That means that the gzip archives you are downloading are being corrupted. Are you behind a corporate firewall/proxy that could be blocking the downloads? I had that problem at my work and I was downloading the HTML proxy block page instead of the archives. Even if you setup the global proxy for the OS, opkg uses the settings in its own configuration file (located at /etc/opkg/opkg.conf). The config file already contains example lines for setting the HTTP/FTP proxy.