Yeah, but MTBE was also included as an anti-knock additive, much like lead used to be. That's the other function of ethanol - it's also an anti-knock additive. MTBE can, therefore, be considered a successor to lead.
Also, the gasoline refineries didn't have a choice - the EPA mandated that they use it. Thank the greenies for that one.
That's basically because it was cheaper to use than octane and nonane, right? If I understand correctly, octane has a higher energy capacity than heptane, but burns slower; typical 89-octane gas burns at the rate of a mix of 11% heptane and 89% octane, but the energy capacity is less than that of such a mixture.
If one were to shift to simply using more octane, I wonder how the cost would relate to the increased number of miles per gallon it would yield?