[1] Calling it Nix confuses with NixOS...
To work though, you'd need some kind of interface to actually access the contents. I guess that's doable, but not ideal.
Someone else posted libsqlfs, which is FUSE Sqlite file system, and should do the job...not exactly plug-and-play though, and presumably wouldn't work on Windows (maybe on WSL tho?)
Perhaps Dokan? Dokan has a FUSE wrapper [1]
With a FUSE filesystem, you're still incurring the syscall overhead that's causing this performance disparity in the first case, plus now the kernel has to context-switch into the FUSEing process. So what would be 2 context switches for each syscall (program -> kernel -> program) now is 3 or 4 context switches (program -> kernel -> FUSE -> (kernel ->) program).
FUSE has some amazing usecases, but performance is none of them.
I'm also approaching this as primarily a Windows user - a lot of the overhead on Windows is access checks, so my thinking is these would be implemented as noops.