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Right now i use smarty caching and it stores cached template on disk, i have new caching handler(memcached handler) that will store cached template in memcached but i cant decide what compression to use and if i should use any? So im thinking of compressing it with gzcompress(level 9) before storing to reduce size but will it effect performance alot? Should i use diffrent compression or maybe lower compression level?

A: 

I guess you should do a test with the apache benchmark:

ab -kc 10 -n 100 http://yoursite.com/page

Var -kc depending on how many parallel requests should be sent to the server. -n defines how many requests in total should be made.

With this tool you can get a quick answer to a change of the compression level. (Don't forget to clear all memcache content before each test though)

rob.effect