UPX-compressing is indeed used by many (professional) software developers (cause it is free to use). It's one of the most common way to compress win32 files nowadays.
For example: If you're using ResHack on a program/DLL and you get the message that it isn't a valid win32 resource type, then try to decompress the file with UPX. Chances are that it was compressed with it.
There are many other compression methods available though. But UPX is currently the most common one. Of course many settings are possible, and one must look out for not breaking the exe/dll (or resources within the file) while compressing.
PS: the timedelay for uncompressing the EXE when you run it is only some milliseconds. You won't notice a thing...
PSS: Matty download the "latest" version (relative of course as it is from nov 7th 2002) on
http://upx.sourceforge.net/. (The one you linked is from may 23rd 2001)
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