pipe compound

Don't use tape, if a small amount gets loose in the line it can plug jets, floats etc.
Yes correct, the tape will turn to mush and be useless, disintegrate.
Compression fitting need nothing.
If anything (on other fittings other than compression) a small amount of pipe "Dope" very LITTLE is needed, get the non hardening type so you can make it easy on yourself taking it apart latter.
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