Hi, you should take a look at our
Horsepower Calculator and our
E85 Calculator Article ...
Basically going from Gasoline to E85 you're going to get about a 15% boost in power from the oxygenation and the different fuel energy density.
You will also need larger injectors (about 40% larger) since typically stock injectors are sized to max out around 70 to 80% duty cycle, you will not have enough head room left on your stock injectors to compensate for an E85 conversion.
As far as how much compression you can run... use or temperature model in the calculator to find your new CR given the higher auto ignition temp of E85 ... and yes some timing advance is required for MBT (mean best torque) but unlike gasoline, you may run into and PASS MBT long before you reach pinging... so the only way to tune E85 for MBT is going to be on a dyno because the knock limit is so high that if you keep advancing timing you reach and pass MBT without any sign of knock (where as gasoline will typically give MBT a few degrees before knock so you advance up to that limit.
Given this is an older motor and you'll be making 15 to 20% more power... I have to ask this... are you using aluminum or cast iron heads ? keep that in your mind (extra cooling).... 20% more power is about 80% more heat ... since engines are typically only 25 to 40% efficiency in converting fuel to power, the rest is used to heat stuff up