34GB is a fairly hefty chunk, I'm not buying "better compression" that they will undoubtedly claim, I'm betting quality of assets has been reduced here and there.
Depends on how poorly they maintained the original install base. Leveraging SSDs in PCs and Consoles could allow them to streamline their data structures into denser install sizes.
Better runtime performance? Maybe so but only if they were I/O limited before hand such as texture pop in, slow loading etc. Which I person never noticed even on PS5.
Though they could be talking about other areas of improvement.