I have read the whole post and ther is alot of great ideas here. One thing that I didn't see was the testing of the knock sensor. Take a long 3/8 drive extension and tap on the back of the intake near the knock sensor to see if it registers knock. If not, then install a new sensor and trouble shoot from there.
I have an alky system on my car with 6 nozzles spraying down each runner. (one nozzle per cylinder) I used the smallest fuel nozzle I could find from NOS. (sorry, don't remember the size, but I think they were .015"). I had to use a alcohol compatable nitrous fuel valve to eliminate flow under a vacuum condition. I can unplug my fuel injectors and open the solonoid and run the car to 3500 rpm with no gas flowing. Smells like a sprint car, though.
We are having problems with a StageI 274cid engine keeping head gaskets alive, too. Well, actually its pushing water out, but haven't removed the heads yet. I used Cometics with copper coat between each layer, and it uses 14 bolt TA heads. The car ran 10.12@135+ on pump gas and dual nozzle Alky system. (not my car, Dennis Hogans T-Type) I'll have the heads off in the next few days, though. I, too, feel it's alcohol related and am going to try and science a solution out. I really think it's time to engineer a real EFI alcohol system to work evenly with 750+ hp, when using alcohol and pump gas. That's just way too much power to leave fuel distribution to chance. Time to use multiple nozzles at a minimun and a fuel valve. Maybe I'll swap my parts over to his car and see if it works better than a dual nozzle set-up. His car still runs a stock ECM and a 3.5" MAF w/ gen1 Translator, too.