i have the undead2live document pinned down to the grub/kernel/initramfs group being what is preventing squashfs from booting classy.  funbuntoo works using ubuntu's kernel/initramfs/grub group to boot our squashfs archive.  im pretty sure our kernel & grub are just fine, we just need to update the initramfs to load up the overlay filesystem in /run & make the rest of mounting and booting squashfs a smooth ride.