In the quest for creating more room in a pannier I came across vacuum clothes storage bags that compress the clothing as the air is removed from the bag.
In the pannier I put clothing in I have lined the inside with one of these vac bags. What used to fill the pannier completely now compresses down enough to create an extra 3" at the top of the bag. Mission accomplished.
The bags do not require a vacuum source, instead the bag is compressed and a valve on the bag allows the air to escape. Simple and effective.
Next step is to do the same with a sleeping quilt. Just need a bag large enough to fit it.