@george1421 DUDE it worked after adding imgFormat=0 (for gzip). Thank you again!
For anyone having the same issue I ended up with this GRUB menu item:
set myfogip=10.100.71.8 set myimage=/boot/bzImage set myinits=/boot/init.xz set myloglevel=4 set timeout=-1 set fogimage=2018-07-17Win10-1803UEFI set imageid=9 insmod all_video menuentry "1. FOG Quick Image Deploy $fogimage" { echo loading the kernel linux $myimage loglevel=$myloglevel initrd=init.xz root=/dev/ram0 rw ramdisk_size=127000 keymap= web=$myfogip/fog/ storage=$myfogip:/images/ storageip=$myfogip boottype=usb consoleblank=0 rootfstype=ext4 imgPartitionType=all chkdsk=0 capone=1 type=down imgid=$imageid img=$fogimage imgFormat=0 imgType=n osid=9 echo loading the virtual hard drive initrd $myinits echo booting kernel... }