Now that scrollback is shaping up, I'd like to discuss the possibility of replicating vte's unlimited scrollback feature after it is merged.
I'm volunteering to implement this if @jwilm approves the possibility to including it.
The way vte implements unlimited scrollback is quite fascinating and would fun to implement.
Data is stored using in an O_TMPFILE. vte uses a special Snake data structure and adds compression and encryption. The reason for encryption was not obvious to me, but it turns out it's for this bug.
Of course, performance would be a concern, but it would be a non-default option. The backlog would be handed off to a separate thread (which would be mostly IO bound) as to not impede rendering.
I've used this feature probably for a long as it has been available (2010ish), and I've never had major a issue with it that I can remember. I find it useful in my work, and I can't depend on a terminal that does not have it.