[Galaxy Y GT-S5360 and Duos 6102 Q&A, Help & Troubl] tobbbie:
Well even though many thanked your post, your statement is wrong in several regards. You say that Android has no swap partition (which is true) and so zram would not bring a performance boost (which is partly wrong). It will also not give you more RAM (just check any program that reports available RAM on the device). It will actually give you LESS free usable RAM, but supply an additional type of memory space (the swap) instead. This Linux "Swap" space is usually not activated with Android on top of it but there is no reason not to try out.

Despite its name, ZRAM has little to with RAM (except that it uses it). ZRAM is a block device in RAM which can be used only for Swap purposes. It acts as a swapfile however is not on disk but in RAM where the blocks are compressed - so not using the size they would use on uncompressed devices - like a disk.

For its use just look at the sequence of actions to activate it (from my device):

#!/system/bin/sh
sysctl -w vm.swappiness=100
echo '1' > /sys/block/zram0/reset
echo $((64*1024*1024)) > /sys/block/zram0/disksize
mkswap /dev/block/zram0
swapon /dev/block/zram0

set swappiness to max value (this makes sure it also well used) - you may vary here

you must create a block device in \dev\block\zram0

you activate swap on that device

So you see that actually the normal Linux SWAP is used, but it is on that special ZRAM device. Contrary to assumptions read, the amount of swap space reserved is the offered space to the system (in my case 64MB), but not the RAM eaten away from the system. That is the good part of the story - in my observation the amount of RAM eaten is just 1/3 of the swap space offered. You get the used size be accessing \sys\block\zram0\mem_used_total.

Well and "performance boost" is not what you may expect here. The swap space can help to keep applications "active" for Android instead of killing them for low memory. So if you switch back from a large gameplay eating all your RAM the Launcher may just swap back from ZRAM which is much faster than having it restart and read all the apps icons again. Same when switching to other apps that were active before.

Mind that the already sophisticated Android management (with priority levels of RAM use for applications) gets another complexity below that on the Linux layer with Linux SWAP. On Linux level the "swappiness" and on Android the memory levels for the memory manager priorities may need to be aligned with a clever strategy (which I don' have). I am too little expert on memory management but I noticed that Go Launcher much less reloads with ZRAM than without.

Edit 20121214: I have de-activated swap in the meantime for me. Things are getting too laggy for me in daily use, no matter which swappiness selected. So I pay the price that sometime I could have Go launcher not reload with much more frequently waiting for any other UI action to complete. This is not even predictable well (because of not well linked memory management is my guess) and so I chose the lesser evil for my use.

Please also consult other sources as your device may have different paths to read data from. The architecture of Linux/Android is however surely the same.