You don't need to extract anything. I would recommend adding the HTL package on top of Zathras via the mod ini file.
On my installation I put the following in the mod.ini file in the HTLpackage folder (and I have the HTL package selected as a MOD):
primarylist = ;
secondarylist = zathras;
That way, all assets from Zathras are loaded, except the ones that exist in the HTL package, since those have higher priority.