Update:
Times for the above script running, creating squashfs:

Code:
Set up workspace...............Thu Jun 21 10:01:06 UTC 2012
Copy live system...............Thu Jun 21 10:01:19 UTC 2012
Create squashfs...............Thu Jun 21 10:10:15 UTC 2012
Loopcreate persistent...............Thu Jun 21 10:15:57 UTC 2012
Purge workspace...............Thu Jun 21 10:17:14 UTC 2012
Ca 16 minutes for full remastering of a Poor Man's Install, on a slow (5400RPM, small cache) harddisk. Note that without a loop-mounted work image, purging temporary files may take quite some time. So the image technique is both file system agnostic and rather efficient.
And sizes for both images:
Code:
-rw-r--r-- 1 root root 3799736320 Jun 21 10:15 KNOPPIX.sq
-rw-r--r-- 1 root root 4035784755 Jun 20 13:06 KNOPPIX
It is of course possible to get higher isofs compression, but that will take some more time.
I think this illustrates the handiness of squashfs, and I wish Klaus K would include the small changes needed to support it in the minirt init script. Doesn't need to tell anybody about it, either, in case he is afraid of more support work

If I get around to modifying it, I'll post a patch for the 7.0.2 minirt init, otherwise I think the structure of earlier posted patches still apply. This exercise was just for testing, but I must say I am tempted to use squashfs as the default - my whole current setup, including a lot of Java infrastructure, will then fit on a FAT32-file.