In another post, I have uploaded and documented a minirt init modification handling cloop and squashfs transparently for the user, just using cheatcode "squashfs". It's for pure 64-bits, but the modification for 32-bits is trivial.
IMHO, present day squashfs seems to be about as stable, efficient and versatile as we need for this kind of use, and its widespread and growing use indicates others think the same.
So, with a "uni-minirt", KNOPPIX may still be distributed as cloop image, but subsequent remasterings will not have to unpack minirt.gz to make modifications in order to turn to squashfs. I think lots of remasterers will prefer squashfs, as it gives (at least) slightly simpler and faster workflow with at least as good results. OTOH. I can't see anything right now forcing us to use squashfs.
And, just for the record: This is not about the practicality or usability of cloop per se, but about the actual Knoppix use case.
Vintage Apple Powerbook 180c M7940 (Color ver of 180)
$259.95
RAD Apple Mac Powerbook Duo 230 Vintage Laptop
$60.00
Vintage Apple Power Macintosh 7200/120 48MB RAM no HD, powers on, good display
$70.00
Vintage Apple Mac M0116 Keyboard salmon Alps switches, no ADB cable, bad T key
$50.00
Vintage Apple Macintosh SE M5010 Computer w/ Keyboard & mouse -power up- no OS
$139.99
Vintage Apple Mac Color CRT Trinitron M1212 monitor/keyboard/mouse - Powers On
$150.00
Vintage Apple Power Macintosh 7300/200 32MB RAM no HD, powers on but no display
$60.00
APPLE MACINTOSH CLASSIC II M4150Vintage Mac Computer POWERING ON NO VIDEO 1991
$65.14
APPLE MACINTOSH PLUS 1 MB M0001A Vintage Mac Computer NOT POWERING
$65.14
Vintage Apple Design Keyboard M29080 And Mouse M2706 ADB Mac 1995 Tested Working
$54.96