The code you are using is from the GD library ?
Anyway some code I think works although I can not get "identify" to work on my server so I have downloaded the modified image and checked it in Gimp and it seems to be 300dpi still.
http://www.rubblewebs.co.uk/imagemagick ... k_text.php
Working with 300 dpi JPG: Offering $100 reward for solution
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