It would be nice to use xz compression by default for the documentation install and binpkg creation/unpacking. Dunno if bzip is used anywhere else.
see Bug 372653 wrt small files (e.g. documentation)
Hmpf you are right it really has some overhead compared to bz2 :) Anyway for the rest it would be good idea :) (also we do not ship stage3 tarballs with xz compression i noticed, but that is not bug for the portage lads :))
xz stages would be cool. best to file a new bug :P.
*** This bug has been marked as a duplicate of bug 142579 ***