Earlier quoted context omitted.
This is mostly true. The packages of assets for games are compressed but the individual assets are usually not. It’s mostly fancy zip of files with maybe a different header.
So they're compressed? What's wrong with compressing packages? That usually produces a better compression ratio by exploiting redundancy cross-file.
The issue at hand around install size comes down to the engines, their ability to decompress asset bundles, the fidelity of the assets (8k vs 8k,4k,2k,1024) if no runtime optimization is done. WAV sounds vs OGG vs MP3 vs flac, there’s a lot of shit in those asset packs. You could compress it all like they do, into a folder structure you can index and load from, or you can write that game code to make boss fights cause camera shake, the decisions you make making a game are really all about making the game and little to do with how best to deliver your content.
Some texture formats like DXT are already compressed. Raw PNG’s could have compression. All these things are possible if the engine supports it.