Ben HerzogSpecifically for the act of this compaction, preserve only dialogue, action, and concrete sensory detail. No interpretation, no emotional summaries. Screenwriter rules: if a camera couldn't capture it, cut it. Subject to those constraints, you have absolute artistic license in what to preserve and how to stitch it all back together. Minor modifications to facilitate the stitching are ok and expected. Once compaction is complete, resume the narrative as before, and produce all further output in natural prose.
Very visible improvement over default compaction for me. YMMV obviously.