>
> Grub will boot from a compressed root pool just fine.  So long as it's
> gzip compressed (which is the default when you turn compression on).
>

>From zfs(1M)

     compression=on | off | lzjb | gzip | gzip-N

         Controls  the  compression  algorithm  used   for   this
         dataset. The lzjb compression algorithm is optimized for
         performance while  providing  decent  data  compression.
         Setting  compression to "on" uses the "lzjb" compression
         algorithm. The "gzip"  compression  algorithm  uses  the
         same compression as the gzip(1) command. You can specify
         the "gzip" level by using the value "gzip-N" where N  is
         an  integer  from  1  (fastest)  to  9 (best compression
         ratio). Currently,  "gzip"  is  equivalent  to  "gzip-6"
         (which is also the default for gzip(1)).

-- 
Regards,
        Cyril
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