I take it you haven't see the results of a diesel-powered VW car vs. the gasoline engine in the same car recently. For a 2005 Jetta diesel vs. gasoline, we're talking 45 vs 30 MPG (respectively) on the highway.
The recip internal combustion engines with the highest thermal efficiency in the world are diesel cycle engines, with thermal efficiencies over 50%.
From the bold assertions you're spouting, I also take it as a given you don't know what a Miller cycle engine is, nor that they exist and that the Japanese are both experimenting with this engine type and actually delivering this type of engine in some vehicles (Mazda and Prius, for two examples).
Some science for your consideration:
1. Miller cycle engine research and ethanol:
http://www.findarticles.com/p/articles/mi_qa3957/is_200401/ai_n9382369
2. An abstract of research in adding ethanol to diesel fuel for burning in a diesel engine:
http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V4S-4DFK6BN-1&_user=10&_coverDate=05%2F01%2F2005&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=56e189499ee1d880b8674b1b0e13ea0a
3. Abstract of SAE paper by Mazda engineers on their use of a Miller cycle engine to improve their mileage and lower their emissions:
http://www.sae.org/technical/papers/950974
4. It has been well known by engineers for over 100 years that increasing engine compression (either with longer piston strokes, or with turbo/super charging) does increase thermal efficiency. Diesel engines achieve their high thermal efficiency due to their higher compression, and resulting longer power stroke, which extracts more mechanical power from the thermal power of the fuel.
And before you go off on some rant about the heat content of ethanol vs. gasoline vs. diesel fuel, remember this: thermal efficiency ratings of internal combustion engines makes this "my fuel can beat up your fuel" bickering complete nonsense. When engines are evaluated for thermal efficiency, it is purely an evaluation of "how much of the heat content of the fuel we put in the engine were we able to extract at the crankshaft?" Thermal efficiency testing completely discounts any issue of how much heat is contained in any given unit of the fuel. It is purely a measurement of conversion and is fuel agnostic.
But let's say that you're going to take the position that this is all "engineering gobblegook", which so many uninformed, non-engineers seem to take about these things. Engineers have to study thermodynamics, which is the engineering way to look at internal combustion engines. As a result of this, engineers are acquainted with things like the Carnot cycle and so on, and are on pretty firm foundations about compression ratios and efficiency in internal combustion engines. So let's just dispense with all that "technical mumbo-jumbo" that people seem to pooh-pooh and go back to basics:
1. Will increasing the compression ratio in a conventional gasoline engine increase the MPG?
2. Has someone done this, ie, not some theory, but actually built an engine?
2. And if so, why haven't we seen these results in the car/engine market?
#1 Yes. #2 Yes, it has been done. #3 It never came to fruition because of the oil companies (and not because of some conspiracy).
Oliver Tractor Company, which was one of the larger ag manufactures until the 1960's, when it was sold to the White Truck company, experimented with a 12.5:1 compression ratio conventional gasoline engine. This resulted in a significant reduction in fuel use, almost 20%.
GM experimented with increased compression ratios in the same time period, and found the same thing.
So why don't we see these results in our cars today?
Because in a gasoline-burning engine, when you crank up the compression ratio, you run into something called the "ping limit" -- the point at where today's gasoline mixtures start to pre-detonate in the engine. To use a 12.5:1 compression ratio, more anti-knock additives need to be put into the fuel. The oil companies refused to create such formulations due to the expense (which would have made common road gasoline as expensive as WWII aviation gasoline, which was 130 to 150 octane by the end of WWII) and the Oliver and GM projects were shelved.
As a result of this, BTW, farmers went from gasoline engines in their tractors to almost all diesel engines in their tractors, starting in the 1950's and by the late 1960's, almost all ag tractors sold were diesels. This happened mostly for issues of fuel consumption.
So, I can now anticipate your next question: "Why aren't we looking at this again today?"
We are. There is still the issue of the "ping limit" and how do we prevent pre-detonation in the engine.
The bright boys and girls up at MIT appear to have a start on this issue: they're preventing pre-detonation in high-compression engines by carefully timing the injection of (drum roll please) ethanol into the engine to prevent pre-detonation:
http://techfreep.com/mit-ups-mpg-30-percent-with-ethanol-injected-engine.htm
I'm impressed. I did not know the difference was that high. I didn't believe it either, but looked it up here just for a quick resource.
EPA/DOE 2005 Fuel Economy Guide
Initially I thought "why are we not all driving diesels?" But it is the primary reason people buy fuel efficent vehicles in the first place: money. In 2005, the price adder the diesel engine was ~$3,500. (2005 Volkswagen Jetta, TestDrive.com) A seven year investment to break even, longer when you consider time/value of money. Do you think an "ethanol tuned" engine would carry this type of premium? (I recognize, that is a hard question to answer, but critical to the success of a producer of such engines.)
I appreciate the links on the Miller engine. Good reading for me later. And "engineering gobblegook" is what pays my bills. Thanks. A while back a read an article by a Saab Automotive Engineer talking about a new line of engine built specifically from ethanol. He was stating the lower energy content was going to produce a lower MPG but expected people to break even because of the lower price of ethanol. If I can find it again, I'll ping you to it.