In another post, I have uploaded and documented a minirt init modification handling cloop and squashfs transparently for the user, just using cheatcode "squashfs". It's for pure 64-bits, but the modification for 32-bits is trivial.
IMHO, present day squashfs seems to be about as stable, efficient and versatile as we need for this kind of use, and its widespread and growing use indicates others think the same.
So, with a "uni-minirt", KNOPPIX may still be distributed as cloop image, but subsequent remasterings will not have to unpack minirt.gz to make modifications in order to turn to squashfs. I think lots of remasterers will prefer squashfs, as it gives (at least) slightly simpler and faster workflow with at least as good results. OTOH. I can't see anything right now forcing us to use squashfs.
And, just for the record: This is not about the practicality or usability of cloop per se, but about the actual Knoppix use case.
Apple MacBook Pro 16" (1TB SSD, M3 Max, 48GB) Laptop - Space Black -...
$1600.00
1TB/2TB USB 3.0 Flash Drive Thumb U Disk Memory Stick Pen PC Laptop Storage lot
$580.99
Lenovo Slim Pro 9 Laptop, 16" Glass, i9-13905H, 32GB, 1TB SSD, Win 11 Home
$939.99
Type C USB 3.0 Flash Drive Thumb Drive Memory Stick for PC Laptop 1TB 2TB lot
$73.29
1 TB SATA 2.5" Laptop hard drive- Used - Mixed RPM- Tested - Mix Brands/Models
$13.00
WD - Blue SN580 1TB Internal SSD PCIe Gen 4 x4 NVMe
$64.99
CISCO A03-D1TBSATA 1TB 7.2K 6G 2.5INCH SATA HDD
$9.00
1TB HDD/SSD 2.5" SATA Hard Drive for Laptop with Win 10/Win 11 Pro Pre-installed
$28.99
Samsung 1TB 850 EVO 2.5" SATA Solid State Drive MZ7LE1T0 ** READ **
$48.99
512GB 1TB 2tb 4tb 256g M.2 2280 SSD SATA3 Internal Solid State Drive Lot Dogfish
$271.99