yep... I see it on a regular basis. I work in advertising and regularly get photos printed out on inkjet printers using regular paper and all. Sometimes they will even give us a business card to get their picture or logo... only they want to use it 3x times the size or bigger in print.
I have also gotten drivers licenses for photos, 20 year old polaroids, horrible xerox copies, faxes, and tiny web art at 72 dpi.
I always remind people that give me crappy art/photos to work with... "don't expect a miracle because I am not a magician nor holy worker"