OK, not cool to reply to my own post, I know. But I just found this
great resource which basically answers all my questions:

http://www.lycoming.textron.com/supp.../key-reprints/

"Lycoming provides helpful information in various publications,
including Lycoming Flyer Key Reprints. Lycoming's Key
Reprints is our effort to continually share our best practices,
key lessons and engines systems knowledge to empower
our customers."

Lower compression = lower chance of preignition = lower octane
required (ie. auto fuel)!
Yes, that would make a difference to the pocket book!

The issue of using auto fuel is addressed in this series also:

"Auto fuel is now being used as a substitute for Grade 80
aviation gasoline under STCs issued by the FAA. Most
major oil companies and engine manufacturers continue
to recommend that aircraft piston engines be operated
only on aviation gasoline. Deterioration of engine and fuel
system parts have been reported in aircraft using auto
fuel. Operators should consider the added risk of using
auto fuel in aircraft. Remember -- a pilot can't pull over
to the side of the road when fuel creates a problem with
the engine."