squashfs-utils as per squashfs-tools-4.2.ebuild does not support decompressing LZMA images (such as the OpenWRT images, for instance http://downloads.openwrt.org/backfire/10.03.1/atheros/openwrt-atheros-root.squashfs). It can be added to the ebuild at no extra cost ;-) - it's done with xz-utils. Patch included. Reproducible: Always
Created attachment 309469 [details, diff] squashfs-tools-4.2.ebuild: enable LZMA
Fixed in 4.2-r1.