We use compaction in a virtual school, and it works fairly well. Instead of skipping (missing, with possible gaps) a whole year's course, you just go faster through the courses, and cover 2 or 3 years material in one year. In the online lessons you can just skip over any unnecessary repeated material, extra explanations, extra practice (which are provided for those who need it, and are optional) and move faster through the material without wasting too much time. In other words the courses are designed to be compactible, and make it easy to skip busy work and repetition and move on. The courses still might not give needed challenge to the best students, but at least a lot of time wasting is removed.
So compaction is a good idea if you can get it to work. (At least it's better than some alternatives.)
