I took an almost 50% salary cut when I first started working at justin.tv. I don't think you can generally expect the industry average in an early-stage startup. My salary is nearly back up to what it used to be now though.
If you assume the company's most-recent valuation accurately reflects its worth, then yeah, my equity more-than makes up for my loss. Until there's an exit though of course, the equity is essentially worthless (I find I stay more sane if I just act like it has no more value than a random lottery ticket has).
