"it packed 3 characters into 2 bytes"

Sounds similar, if not the same, as the compression system used by the Zork games of the 80s. Source code for the Z machine is available and might provide some useful information that might be adaptable to the problem.

I do agree with Michael on seconding Werner's suggestion to use an eeprom. The extra time spent accessing the data probably isn't as bad as what might be spent decompressing compressed data, and also gives the option of rewriting...without adding compression code.

Dennis