No I don't think this is avoiding the point of the jam. Just have a look what id Software did with Wolfenstein 3D shareware release. They implemented compression for multiple assets in the game to cram it on a single floppy.
To be clear, .jar files (greenlit in another thread) already do this. The contents of the .jar are compressed, and the java runtime uncompresses them on startup.
When you compress stuff down, you're getting rid of a lot of that 1.44MB constraint. Sure you can do it, just don't compress the actual resulting game.
