I've uploaded three p7zip packages for OS2008 (you can goto http://garage.maemo.org/projects/p7zip for OS2007), you should only need one of these but you should be able to install all 3:

p7zip-7z: 7z command line utility, supports all archive types, biggest download size
p7zip-7za: 7za command line utility, supports all archive types except RAR, medium download size : Squishee currently requires this one.
p7zip-7zr: 7zr command line utility, supports 7z only, smallest download

download squishee and p7zip at:

http://garage.maemo.org/frs/?group_id=526