Please do not consider the matter "cleared up" without reference to the testimony of the Tibetan translators themselves.
Pudgala is entry no. 340 in the early 9th c. Madhyavyutpatti (i.e. the Sgra sbyor bam po gnyis pa). I reproduce here the entry as given in Ishikawa’s edition (The Toyo Bunko 1990) with Sanskrit in italics. Note that, because this is an edition of a Tibetan work, the conventions for Sanskrit are in a few cases imprecise – I’ve copied them as given without bothering with the addition of “sic!”:
puṅgala ni punaḥ punar gatiśu liyata iti zhes bya ste / yang dang yang lha dang mi la sogs pa’i rgyud du skye zhing sbyor bas na yang sbyor zhes kyang bya / pūryate galati caiva puṅgala zhes kyang bya ste / skye nas dar gyi bar du ni gang / dar yol nas shi ba’i bar du ni zag pa la yang bya ste / tshig ’di gnyis kar yang drang du rung gis kyang sngan chad ming du btags te grags pa bzhin du bzhag nas gang zag ces btags /
For the benefit of those who do not read Tibetan, here is an off-the-cuff rendition:
"puṅgala is defined: punaḥ punar gatiśu liyata iti. Because one is born and is joined repeatedly to existence as a god, human, etc., it is called 're-joining' [perhaps for punarbhava]. It is also explained: pūryate galati caiva puṅgala. From birth to maturation one grows (lit. "fills") and from maturation to death runs down (lit. "leaks, oozes"). The term may be explained in either way, but because the designation made earlier is well-known, it is left as is and gang zag is the [accepted] designation."
This is interesting in part as it suggests that gang zag (“grows and runs down”) was in current usage prior to the work of the translation committee responsible for the Madhyavyutpatti, but it does not clarify whether it had been a coinage of earlier translators or a Tibetan convention that had arisen otherwise.
The late Michael Hahn may have had the above in mind when he wrote his remark cited by Prof. Steiner, but he did not enter into it in detail as he was concerned in that article to mention it as an analogy for the type
of compound we find in gtsug lag.