Dynamic compilation (i.e. compilation during execution and/or modifying the emitted compiled output during run-time -- depending on which school one prefers) was never a thing on the Lisp Machine, and is not even a thing in modern Lisp implementations like say SBCL which just does static compilation (compiled object is never modified when it has been compiled).
(print-herald)
LM-3 System, band 4 of AMS-LISPM-2. (LM-3)
2048K physical memory, 16127K virtual memory.
Experimental System 300.0
Experimental Local-File 54.0
Microcode 323
AMS Lisp Machine Two, with associated machine FS.
(defun foo () "bar")
FOO
(compiled-function-p #'foo)
NIL