I would be really hesitant to start gating too hard in order to heavily compress. If you do that, then things like the hi hat and OH's (or whatever you were trying to get rid of) will start to swim a whole lot every time the gate opens up. If things are coming up by compressing the snare, then try and use those sounds in your mix. maybe turn down or even mute the hi hat track and see how it sounds. Another thing is try different snare mics and placements to help minimize those other sounds. You might even want to try and physically build something that helps isolate the snare mic a little more. What I usually do is rely on my bottom snare mic to help with radical sound changing on my snare drum tracks. If placed properly the bottom mic will not get too much bleed so that you can give it a really tight gate and use it to add a lot of smack and/or punch to a snare.
As far as software gating goes, software gates are definately very usable. However, I do find them to be very different feeling and sounding to a good hardware gate. They may work as well as a Behringer gate (which I actually don't mind using at all), but don't have nearly the same naturalness and transparency as something like a nice BSS, Klark Teknik or Drawmer gate. All the same, for simplicity and automation reasons I still use software gates for my mixes.