The oil companies would have gone on and happily not put any extra/costly additives to gasoline. They would be happy just to pump out gasoline instead of having to make blends. Thats yet another step in the manufacture of fuel, and adds costs.
Quite true. New formulations for gasoline, even without adding ethanol or anything else, actually meet the fed clean air requirements. Cleaner burning gasoline, along with newer cars that burn that fuel more effeciently, mean that air quality is steadily improving nation-wide, wherever it is automobile traffic responsible for dirty air.