I'd just avoid .zip as much as possibble - especially
those extended formats.
I use (standard) .zip (created by WinRAR) when I need to distribute small things, because just about everybody can open zips, and WinXP even has built-in support for zip.
When I need to send files to people, I use RAR. Better compression and good speed, and all people I send files to use WinRAR anyway
If I need to do a setup for something larger, I'll probably choose LZMA - cab, 7zip or nsis. Although RAR is still a viable choice, since at least the decompression algorithm is free.