I obviously stayed up too late.

I couldn't change defaults like:
#mt -f /dev/nst0 defcompression 1
but I could do:
#mt -f /dev/nst0 compression 1

The solution to my problem was to do:
#mt -f /dev/nst0 compression 1
#mt -f /dev/nst0 setblk 0

Then restore operations succeeded.

Mystery solved.