I agree with that idea Greybeard, in principle, but in reality I've never actually found compression testing to be an accurate guide to anything!!
Compression testing is a good way of monitoring wear
However you have to keep track of the compression readings over time
Thus you will know when new rings are are needed well before you start laying smoke screens
A sudden large drop will usually mean a gasket leak
When I ran the SR500's & XJ 750's for work they all got monthly compression tests
The SR's would start off about 175 psi and by the time it dropped to 120 it was new ring time and I could usually get 3 or 4 sets of rings per rebore
With the XJ's the magic number was 95 psi.
However the tests have to be done the same way using the same tester as there is quite some difference between them, particularly at the domestic end of the range
You are right about a random test of an unknown engine, all it will tell you is either it is too high so pistons are probably going to hit the valves or head or too low so it won't start on petrol.
Bt a calibrated calf muscle will alert you to both of them as well .