N2O and high compression love eachother. The limit is the durability of the head fastner, the head gasket, and of course the state of tune.
The use of N2O on a high compression engine is actually a knock/detonation preventer.
N2O increases HP via two avenues. 1st, is under the pressure of combustion, it becomes unstable, and sheds an oxygene molecule. This molecule is then available to combine with fuel (and there better be some hydrocarbon based fuel there, if not, the fuel source might be aluminum) and provide a greater amount of combustion efficency than a naturally asperated engine running at that same RPM.
The second, is the temperature change to the intake charge because of the N2O induction. The N2O leaves the introduction source as an expanding gas. Supercooling the adjacent air. This supercooling allows the engine to pack more intake charge into the cylinder. Mine shaft air, on hot humid days.... etc. This supercooling is also what helps keep high compression engines out of detonation.
Ive got a combination at 17-1 with a single stage NOS Profogger system on it. Its set up for a 500hp shot of N2O with a NOS controller to allow pulseing of the N2O solenoid and a gradual intorduction of the charge.
As for using N2O with alcohol, you run into several snags. Now 100hp shots etc work fine, and NX has a great alcohol system for them. But alcohol and N2O do similar things, they both supercool the intake charge, and an alcohol based fuel system is designed around a percentage of the alcohol going up in evaporation. I tried to buck the system, and run a Alcohol based engine on an alcohol based N2O system. The problem was the high volume of alcohol running through the engine, no longer evaporates when you get the intake charge THAT cold. With the high compression engine, it ended up hydraulicing a cylinder or two with raw alcohol, lifted the head a bit, and flashed through the head and head gasket, couple of nice fire channels to repair.
So if your going to run more than a 150hp shot of N2O stick with ALL the recomendations of those that tell ya not to do it as an alcohol only based engine. Run one or the other (N2O shot if the engine is already set up for alcohol fuel) on gasoline, so you keep a little heat, and reduce a lot of the fuel volume for the engine. IT will still be a tunning challenge to set up the fuel curve, but less of one than what I tried. About the only way I could see it possible to do an alcohol/alcohol N2O system would be if both systems were done with EFI injectors and some sort of ACT (air charge temperature sensor) could tell a computer that the evaporation rate of the alcohol was zero and the engine was actually getting EXCESS fuel. More money and time required than I have.... and I opted for convention, converting the whole thing over to gasoline, and pressing on.