Pseudo-polynomial dynamic programming has two opposite movements.
First, it compresses a large combinatorial search space into a table of states. For knapsack, brute force asks which of the
Many different subsets can lead to the same state
That is the compression: many histories collapse into one table entry.
The Expansion
The second movement goes in the other direction. The state coordinate
If
So pseudo-polynomial DP compresses the combinatorial part while expanding the numeric part.
The Point
For knapsack, dynamic programming replaces the brute-force search space
This can be a real compression of the subset search. But it is not necessarily ordinary polynomial time, because the numeric dimensions
Therefore, pseudo-polynomial dynamic programming compresses histories into states, but may expand compact numeric inputs into unary-sized table dimensions.