In the past, I've sponsored squashfs-lzma patches in order to support 7-zip's lzma compression in squashfs. But even squashfs itself was not included in Linux kernel, so it was not possible to 'mount' Slax modules in any distro other than Slax.
The situation has changed now. SquashFS is included in mainline and XZ (lzma2) support is included in kernel as well. So I've compiled mksquashfs tool with xz support and tested the compression ratio.
I hoped to get some exciting results, however there is no excitement at all. That doesn't mean it would be bad, not at all! It's just compressing 'the same' like before :)
Using dictionary size of 250k I got the very same size (differece in about 100 kbytes) from the previously used lzma patches. The compression ratio is the same, it's not worse than before, that's good ;) And the best part? You can mount that filesystem on any distro with recent kernel.