A gzipped tar archive is not an archive of compressed files. It is a compressed archive of files. In contrast, a zip archive is an archive of compressed files.
An archive of compressed files is a better archive format, if you want to be able to extract (or update) individual files. But it is an inferior compression technique; unless the component files are mostly quite large or already compressed, compressing the files individually results in quite a bit more overhead.
Since the primary use case of gzipped tar archives is transmission of complete repositories, and the entire archive is normally decompressed at once, the fact that it is not possible to decompress and extract an individual file [Note 1] is not a huge cost. On the other hand, the improved compression ratio brings a noticeable benefit.
To answer the question, the only way to combine multiple gzipped tar archives is to decompress all of them, combine them into a single tar archive, and then recompress the result; option 1 in the original post.
Notes
- Of course, you can decompress the entire archive and extract a single file from the decompressed stream; it is not necessary to save the result of the decompression. The
tar
utility will do that transparently. But under the hood, the archive itself is being decompressed. It is not even possible to list the contents of a gzipped tar archive without decompressing the entire archive.