A simple way to make a character "squish" when landing is the following:
Player - set height to self.height*0.8
Player - set width to self.width*1.2
System - wait 0.1 seconds
Player - set height to self.height/0.8
Player - set width to self.width/1.2
Basically, this will "compress" the sprite, making it look wider and shorter for a moment, then quickly go back to normal.
I'm not sure what sort of visual effect to expect from a squishy character jumping or walking around, though - if you have something in mind, let me know and I'll see if I can help. Good luck!