This is a process called minificiation. I believe the specific script you mention is using Packer, but there are tons of services that do this (the YUI compressor is one notable example).
Edit
For some reason, you don't believe this is minification because of the piping at the end. Try using Packer's example code:
// sample code
var input, output;
// notice the semi-colon at the END of function declarations
onload = function() {
input = document.getElementById("input");
output = document.getElementById("output");
clearAll(true);
};
function packScript() {
output.value = pack(input.value);
};
function clearAll(focus) {
output.value = input.value = "";
// the "if" statement is NOT terminated with a semi-colon
if (focus) {
input.focus();
}
};
Paste it into Packer, check Base62 encode. It produces a similar result.