Farrago, allow me:
First off, realize that whatever numbers you see pertaining to a day's short count can be misleading. The daily short count does not necessarily mean that a Short(s) has opened a position for that amount. Shares often have to be transfered from one broker to another, which usually takes up to three days. It is the FTD's (failure to deliver) that raises concern.
When people sell thru NITE to people who buy thru NITE, it is pretty much a clean trade. When NITE sells to ETMM, then it might take time to execute the actual trade in shares. It depends on if your broker already has street shares or not.
Oftentimes, people think there will be a massive short squeeze (for whatever reasons), but never comes. This, primarily because they misunderstood the difference between bonafide opened short positions, and shares that were sold but not transfered yet (the day the trade occurred).