If the DMG speed is too slow for development and running tests(not testing with the full live dataset) you are doing something wrong.
Right now I have a vagrant box where the VM images is on a DMG and all data is NFS mounted from the same DMG onto the VM, which is kind of the worst scenario I can think of. The testing database is around 2GB and the source+data files etc is ~200MB, just because I actually do need to fix a bug related to a portion in the production data. What's slow is the CPU, and that is still doing fine. It's not the disc even though I'm abusing it this way. That's on a 2011 macbook, 16GB, 400GB SSD.
HN is a small piece of software which should be easy to write tests for, 2GB db and 200MB source/data-files should be more than you'd ever need to work on something like HN. If you want to stress-test, test fs speeds etc you cannot do that on Mac OS X anyways since you're not running Mac OS X in production.
Changing the specs of a piece of software in order to make development more easy seems totally backwards. You're developing for production, not the other way around.
And at last, why not simply add a case-sensitive partition to your Mac if speed is such a big problem?