Squish pads produce;
A required (read as "desirable") amount of turbulence in the mix right at the end of the compression stroke. This greatly improves mixture distribution and mixing at the point where it is getting ignited, leading to obvious desirable improvement of pretty much all the combustion parameters of interest.
A reduction in the surface area of the head and piston facing the flame at and near the moment of ignition. The tiny little volume of mixture trapped in there is a better compromise than the otherwise exposed but narrow corners all the way around the rest of the combustion chamber where it meets the edge of the piston. Small combustion chamber volumes and decreased surface area should cause improved resistance to detonation, rather than the commonly held opinion as expressed by R32-25t above. Which is not to say that once the usage of the engine is pushed waaay beyond where the OEM engineers expected it to be, that perhaps the hot edges of the squish pads do trigger detonation.
I'd be willing to believe the improvements in ignition triggering, ECU accuracy/speed and fuels (ie E85) have probably exposed the old belief as being more of a band-aid for problems with real causes elsewhere.