I'm a WinRAR not-quite-but-close zealot myself, and I've been using RAR since the early DOS days. It's fairly fast, has a very good compression ratio, has portable source available for decompression (so while it's not quite opensource, at least it's not 100% lock-in and dependency), the UI is nice and unbloated, and there's very good commandline support as well. RAR also offers AES encryption, recovery data, authentication verification, and support for NTFS streams and security info. Licenses are pretty darn cheap. Quality software!
7-zip isn't half bad, and it's speed has improved a lot during the years. But while it's opensource, I dare you to actually do something with it - the LZMA SDK is one big pile of ugly spaghetti code, as I'm sure most people who's worked with it can attest. Dunno how portable it even is, without a lot of glue code...
Zip is a pretty sucky format today, especially because of it's lack of solid compression. The format has been amended a bit with later versions of winzip and whatnot, but once you start using those extensions, you risk that other people can't decompress, and you lose it's "available everywhere" status.
For source code distribution, especially if it's portable, I prefer .tar.bz2 (or if you want to support even really old quirky architectures, .tar.gz) - not because it's necessarily the best format, but because it's available pretty much everywhere, and still has a decent compression ratio.