Good riddance; for text files, gzip is mediocre compression and fast, lzma (xz) is high compression and slow. Bzip2 is medium-high compression and _really_ slow [0].
http://pokecraft.first-world.info/wiki/Quick_Benchmark:_Gzip...
LZMA tends to be faster and more efficient than bzip2 in all respects.
http://git.annexia.org/?p=pxzcat.git;a=summary
I also wrote a random access program for xz files:
https://github.com/libguestfs/nbdkit
(in the plugins/xz subdirectory)
However, it is true that that same option does not seem to work everywhere. At least, it didn't seem to work a few weeks ago in a different system (Ubuntu). The option is accepted, but does not seem to have any effect.