git repack with a --reference

Hi - hope this isn't too noobish but I'm trying to get an existing git
checkout to repack/prune/gc itself such that it would be like I had
cloned it with --reference /path/to/local/repo (i.e. I've added
/path/to/local/repo to .git/objects/info/alternatives, and I'd like it
to reduce its objects from 200 MB to 5 MB). Is this

a. possible,

b. desirable, and

c. not insane?

Cheers,
Jonathan Harker
http://catalyst.net.nz/