No, it is the wrong compression level and method for sources!
The source compression shall either be left as it is or be set to gzip -6 … -9 (6 is gzip’s default). For the binaries it is fine to use xz -2 … -6; for RPMs which are only installable on SailfishOS ≥ 3.2.1 one may add the option -T.
Yes, this all has been documented before in depth.