It's a standard zip compressed
bootstrap.dat file, combining all blk*.dat files out of the blocks directory.
The actual bootstrap.dat is not compressed. The one you are downloading is, but it isn't the official one that was maintained by jgarzik.
Maybe we should discuss adding a zip level compression (or better suitable) algorithm to the Bitcoin-Qt client to reduce the amout of data needed to be transferred to update the block chain.
There is talk on the mailing list about block compression and ways to speed up syncing, but I don't think that any of it will be coming in the next release. It either isn't ready or there isn't any particular need for it. Using the actual bootstrap.dat (not the one that you used) is not actually faster than simply letting it sync.