Try using the SQUASHFS_4K_DEVBLK_SIZE config option next time
By default Squashfs sets the dev block size (sb_min_blocksize) to 1K or the smallest block size supported by the block device (if larger). This, because blocks are packed together and unaligned in Squashfs, should reduce latency.
This, however, gives poor performance on MTD NAND devices where the optimal I/O size is 4K (even though the devices can support smaller block sizes).
Using a 4K device block size may also improve overall I/O performance for some file access patterns (e.g. sequential accesses of files in filesystem order) on all media.
Setting this option will force Squashfs to use a 4K device block size by default.
I'm quite sure I have tried all options available in the kernel I used back then without achieving performance comparable to ext4. My project manager was conviced that squashfs makes things faster (and so hoped I initially because the overall data volume is smaller) so I had a hard time to convince him that we will just drop that "optimization" from the project plan. (He was one of those who can prefer checkmarks over technical merit.) I don't remember the 4K option for sure, but if it existed, we tried and measured it. What is the size ext4 is reading from the block device? I'm reading this on holidays on my phone, so I cannot easily fire up blktrace. But I could guess it's 128K or even 256K. So still far from 4K.
By default Squashfs sets the dev block size (sb_min_blocksize) to 1K or the smallest block size supported by the block device (if larger). This, because blocks are packed together and unaligned in Squashfs, should reduce latency.
This, however, gives poor performance on MTD NAND devices where the optimal I/O size is 4K (even though the devices can support smaller block sizes).
Using a 4K device block size may also improve overall I/O performance for some file access patterns (e.g. sequential accesses of files in filesystem order) on all media.
Setting this option will force Squashfs to use a 4K device block size by default.
If unsure, say N.