After digging into the code, it does not seem possible. The Snappy compression is hard-coded. I have submitted a PR to allow users setting this compression codec (https://github.com/apache/nifi/pull/409). You can give it a try if you want.
So you see the dumped file with Compression on? Did you use the command line tools to check it: http://www.michael-noll.com/blog/2013/03/17/reading-and-writing-avro-files-from-the-command-line/
What kind of Kafka consumer?
Can you export your dataflow as a template and post it?
Can you view the file through another HDFS client?