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.
Fanxiang 4TB 2TB 1TB SSD 550MB/s 2.5'' SATA III Internal Solid State Drive lot
$188.99
1.92TB SSD SATA 2.5 SAMSUNG MZ-7LM1T90 PM863 MZ7LM1T9HCJM Tested 93%+
$45.85
Netac 2TB 1TB 512GB 240GB Internal SSD 2.5'' SATAIII 6Gb/s Solid State Drive lot
$108.99
Netac 1TB 2TB 512GB 120GB Red Internal SSD 2.5'' SATA III Solid State Drive lot
$108.99
Crucial MX500 CT250MX500SSD1 250 GB SATA III 2.5 in Solid State Drive
$14.99
Patriot P210 128GB 256GB 512GB 1TB 2TB 2.5" SATA 3 6GB/s Internal SSD PC/MAC Lot
$13.99
Netac 1TB 2TB 512GB Internal SSD 2.5'' SATA III 6Gb/s Solid State Drive lot
$13.99
Fanxiang M.2 SATA SSD 2TB 1TB 512GB 256GB SSD Internal M2 Solid State Drive Lot
$21.99
Fanxiang 2TB 1TB External SSD USB 3.2 4TB Portable Solid State Hard Drive LOT
$249.99
Fanxiang SSD 512GB 1TB 2TB 4TB 2.5'' SSD SATA III Internal Solid State Drive lot
$107.99