I've compressed my Microsoft Office '07 with KGB Archiver to 2MB and I've also managed to extract it without problems. Heck I even used it to install on another computer but with a genuine serial (of course).

my last few attempts with Office 2007 failed with MSORUN.DLL digital signature was invalid... hmmm, what could have been wrong here eh?

Here's how I did it:
I made an ISO of Microsoft Office '07 with MagicISO.
I archived the ISO with KGB Archiver at full compression.
I extracted the archive on another computer.
I mounted the ISO on that computer.
I installed the ISO on that computer.
It worked.

Dang, ISO is teh key, I compress the files as it is, no ISO medium, that's why the digital signature was corrupted...

Precisely, hope my solution works for you. May I know how long it takes to compress?

ARE YOU SURE!? Can anyone prove that what TechnoDude94 is saying is true?

Maybe you can send me that 2mb Office 07'? I can PM you my email, you attach that file to me! I want to see if I can extract!!

(I have no patience to wait days to compress Office 07' ler)

Dang again, compressing MSO 07 within ISO container is like, 3 days? and after 50% of compressing, I only managed to get 95.5% compression ratio! wtf? compressing without ISO container gives me 4.x% compression ratio and it still need around 3 hours before completed. Never could get 2% ratio even when I select the smallest compression...

3 days? thats looong man...

What about the decompression speed? Is it fast?

Decompression speed is as long as compression time, depending on your hardware, if just use old P4 and 512mb RAM, it gonna take ages! dual/quad core is recommended...