DwarFS may be good, but it's not in the Linux kernel (depends on FUSE). That makes it less universal, potentially significantly slower for some uses cases, and

DwarFS may be good, but it's not in the Linux kernel (depends on FUSE). That makes it less universal, potentially significantly slower for some uses cases, and also less thoroughly tested. SquashFS is used by a lot of embedded Linux distros among other use cases, so we can have pretty high confidence in its correctness.