In an internal combustion engine, the lower heat content of alcohol can be offset by certain advantages in its combustion properties. Alcohol is less volatile than gasoline, so the timing can be advanced and the stroke can be lengthened. Its lower volatility gives it a much higher octane rating (denatured alcohol has an octane rating of 113, as I recall), which means that it can power a much higher compression engine. Its latent temperature of evaporation makes it ideal as a fuel in a supercharged engine.
The current problem with alcohol as a fuel is that engines which are tuned for gasoline will run on alcohol, just with a loss of economy. Low octane gasoline won't run worth a hoot in an engine tuned for alcohol.
30% is a fair rule of thumb, although as you say, a couple of energy transformations occur.
In modern low compresssion engines, the octane benefit does not offset the reduced chemical energy of the molecule.
Ethanol does cause a significant reduction in vehicle mileage with family cars---even those able to run on E-85.
You must know more about engines than Saab.
Saab 9-5 Aero BioPower Concept
"The 9-5 BioPower can also run on any mixture of ethanol and gasoline," said Jan-Willem Vester, corporate communications manager for Saab Cars USA. If you can't find a gas station with E85 on tap, you just fill up with the regular stuff and the engine management system adjusts the timing and boost accordingly.
"Mileage is approximately 30-percent worse on ethanol," Vester concedes, "but ethanol is typically 20-30 percent less expensive [at the pump], so for customers it's budget-neutral."
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Too bad that cheaper part didn't hold very long.