Fonts aren't just images. Characters have certain visual features we rely on to differentiate them from each other. When characters are scaled in size, the scaling is usually not done in a uniform manner - instead, the less significant features are scaled differently than the more visually significant features so as to minimize the loss of legibility.
In this context, "mechanical compression" means that the fonts were stretched and/or squashed as if they were mere images - without concern to whether the typographic features would be preserved.
In this context, "mechanical compression" means that the fonts were stretched and/or squashed as if they were mere images - without concern to whether the typographic features would be preserved.