They're the tiny .dds files you see in desktop games (usually that is, DDS is a container, it could hold either DXT compressed data or raw data). Mobile devices have their own formats too (PVRTC, ETC2, etc). And there is ASTC although its starting to get support only recently AFAIK.
ooh wow. I haven't heard of texture streaming or DXT1/BC1 compression before. That's really interesting.
Its not often you send uncompressed data to the GPU since, as you mentioned, its simply too much data. Then again, in 2D games if you do some sort of pixel art kinda thing, DXT compression might screw up the look.