I vaguely remember something that the compressed DirectX formats had to have dimensions of powers of 2. But I created a 200x200 sized texture in DXTex and it saves fine, so it seems the file format does not impose a limitation. So pow2 is not a requirement for compressed DDS formats?

So where does the pow2 comes from? Is it that it might not work on some hardware DX9 hardware? Does all DX10 hardware support non power of 2 textures?

DX9 had caps for non-power-of-2 support. Some GPU's supported it for everything, some only supported it without mipmaps or WRAP sampling, some didn't support it at all. All DX10+ GPU's support it for everything.

The only size limitation for block-compressed formats (DXTn in DX9, BCn in DX10/DX11) is that the width and height must be a multiple of 4. This is because they all use 4x4 blocks for compression.