In regards to compression and size...
First let me state that TC does not run from a compressed image, like KNOPPIX or DSL.
It was the kernel developers, who in v2.6 enhanced the initrd capabiliites of such with the new initramfs in which they, the kernel developers, decided on cpio and gzip. There decisions are documented.
So, TC boots from a gzipped cpio image into ram. TC runs extremely fast as it runs from ram uncompressed.
If size was paramount, I would use a much higher compression other than gzip, i.e., lzma. In fact, it appears that lzma will a supported option for such, as the build of the current system, using lzma would have meant using patches. Lzma patches was in fact not selected as the uncompress time was noticeable, i..e., slower booting than our current deployment.
The pristine boot that I have championed for five years during my involvement with DSL, is what I am still an ardent proponent. You don't need to be booting from cdrom to achieve it. Instead my recommended method to "install to hard drive" is frugal. That is copying two files bzImage and tinycore.gz to any partition of your hard drive and point your bootloader to it. I recommend using grub for easy editing of additional boot time options.
On my developement machine I have grub set to boot TC in all the various operating modes:
title Tiny Core on hda3 (tce=hda3/tcZ restore=hda3/tc_backup nolocal)
kernel (hd0,2)/tinycore/bzImage quiet restore=hda3/tc_backup tz=US/Pacific settime nolocal tce=hda3/tcZ
initrd (hd0,2)/tinycore/tinycore.gz
title Tiny Core on hda3 (tce=hda3/tcE restore=hda3/tc_backup nolocal)
kernel (hd0,2)/tinycore/bzImage quiet restore=hda3/tc_backup tz=US/Pacific settime nolocal tce=hda3/tcE
initrd (hd0,2)/tinycore/tinycore.gz
title Tiny Core on hda3 (tclocal=hda1 restore=hda1)
kernel (hd0,2)/tinycore/bzImage quiet tclocal=hda1 restore=hda1 tz=US/Pacific settime
initrd (hd0,2)/tinycore/tinycore.gz
title Tiny Core on hda3 (base norestore nolocal xsetup)
kernel (hd0,2)/tinycore/bzImage quiet tz=US/Pacific base norestore nolocal xsetup
initrd (hd0,2)/tinycore/tinycore.gz