Wow, I can't believe this thread has been running for this long. From the very first posts it was evident to me that this is a scam. The subtle mentions of financial gain. The need for patent money in order to make the big greens, etc... The interesting part is that one real chief delphi person mentioned that he knows aalfabob of this wonderfull compression scheme.
However, I realize odd things can come together once upon a time and that all of these scam-signs were inadvertent and aalfabob thinks he has this algorithm. If so then I apologize. However, I am 99.999% sure that such a bold compression scheme is impossible as was probably states a few times already in this thread.
On a humorous note: take a look at this
http://lzip.sourceforge.net/.
I do so register my vote (opinion) as above on this issue.