I haven't had the pleasure of reading Graeme's book, but I can't see why speeds would drop with compression. The first, original .303 loads contained 70gr. of black powder with a 215gr. full patch bullet. The velocity was 1,800fps to 1,900fps, which is quite incredible considering it is about a 55gr. case, which would produce a mere 1,350fps if you were lucky.
Without compression, all that black powder could not be inserted. Thus, compression allows more powder to be put into a given case, which increases velocity. More powder, more expanding gasses, more velocity.
Actually the black powder charge was introduced into a straight, non-necked case case as a 'solid plug' of compressed powder, the wad placed over top, then the neck formed and bullet inserted, or the neck formed with the bullet sitting on the wad - I rather think the first way, but I do not know for sure.
The reason we slightly compress black powder is for minor increase in powder, as well as to increase accuracy through even ignition and proper, consistant burning of the powder.
Slight compression helps this, all of which benefits accuracy. Too much compression will usually injure accuracy due to reducing 'some' of the powder granules to literally a dusty powder. The mix of dust and granules reduces accuracy because of inconsistent burning which produces inconsistent pressure and velocities, all being detrimental to accuracy - as I understand this black powder loading scenario.
Like salt - a little is good. Too much, is not good - as far as accuracy is concerned.