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Ethanol has less specific energy, but its resistance to knock allows as mentioned the ability to run more ignition advance and boost. It's much easier to compensate for less specific energy by injecting more fuel than to advance timing or increase boost beyond what will cause gasoline to detonate.
On a side note, hygroscopy actually doesn't cause corrosion, rather the opposite. Brake fluid is hygroscopic for a reason, it is designed to absorb water that becomes introduced into your brake system through moisture in the air generally, and it actually prevents the water from corroding the brake lines and systems.
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