3-instruction remote machine coding Arduino Atmel chip over a serial line from a tethered (host) PC
The AVR CPU cannot execute instructions from RAM. It's not a question of what the compiler can do or should be able to do, the physical chip itself cannot do it. There is simply no physical pathway between the RAM and the instruction decoder in the CPU.
Instructions can only be executed directly from Flash memory. That is how the chip works. You can only execute code that you send over serial if you first erase a page (or more) of Flash memory then burn the incoming code into that page. You can then call the start of that page's address and your code will execute.
But there is another caveat there: only code running in the bootloader flash area is allowed to modify the flash memory. That means your code can't do it, only the bootloader. That doesn't mean that the bootloader has to be running, but the code that you execute has to reside there.
There is an alternative version of the Optiboot bootloader that can provide flash writing facilities to a user program, but I have no experience using it so can't assist with that.