I think you may have that a little backwards, E85 requires more compression to work better. It absolutely sucks in low compression motors. And the modern Flex Fuel engines are just a compromise, they are standard gas engines that are programmed to be able to adjust the jetting and timing farther than normal specs. Had you just used the search function you would have seen that this has been the topic of conversation for a few years. There are quite a few threads on it. Search ethanol.
Here's the same thing from a former SF guy turned independent embed: http://www.michaelyon-online.com/wp/resistance-is-futile.htm
Zman, you may be right I have only read about this. I read about a guy running it in a Model T and he said it was no problem. I don't know how his performance was. it might have been running rough. My father said thay used to put moonshine in with gas or either by it's self in the tank during WW2 when you couldn't get gas this was in a model A ford and a 31 chevrolet I don't think they did it much but it would work.