Somewhat unexpectedly, I am already through with all major program installations, and even without the bzip step, the compressed isofs is below 4GB. Dropping bzipping, compressing isofs doesn't take very long, so there is not really any pressing need for using squashfs. But, squashfs is in many ways a simpler approach. The squashfs image is some 200 MB smaller than the cloop variant.

The purge list is, so far, not very long. I used dpkg-query with sorting to isolate the biggest resource hogs, and didn't have to throw out any important tools to get enough space.

Code:
26956 frozen-bubble-data
28712 kde-l10n-it
30612 etoys
31156 extremetuxracer-data
33108 enigma-data
33224 freepats
35984 qt4-demos
38520 kde-l10n-fr
39668 kde-l10n-de
46912 kdewallpapers
52616 kde-l10n-es
60760 pinyin-database
62844 openvas-plugins-dfsg
65260 tuxpaint-stamps-default
86044 neverball-data
98064 gcompris-data
120892 wesnoth-1.8-data
136684 wesnoth-1.8-music
203404 crossfire-maps


apt-get remove `dpkg-query -l | grep i18n | grep kde | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep wesnoth | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep crossfire | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep gcompris | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep neverball | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep kde-l10n | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep kdewallpapers | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep openvas | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep pinyin | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep extremetuxracer | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep tuxpaint | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep frozen-bubble | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep etoys | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep enigma | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep oxygen | cut -d' ' -f3`
apt-get remove --purge `dpkg-query -l | grep qt4-demos | cut -d' ' -f3`
The most important added packages are OracleXE, Vmware Workstation, Bibble, R w/several extras and jBoss 6. After deborphan and apt-get clean before remastering, only about 0.6 of 4 GB persistent store is used now, after the third remastering, so a fourth iteration will probably not be necessary. As a regexp, the process can be written

purge (upgrade install remaster)+

There has been few package/version conflicts, but most of the big extra packages for R require the full build process, and this has often been something of an hassle. This should be improved upon.