Compression ratio affects the efficiency of an engine, and something
called the 'brake specific fuel consumption' which is a measure of how
much fuel the engine must burn to produce some given amount of
horsepower... or something like that.

A higher compression ratio engine is more efficient in turning fuel
into useful work. But there are trade-offs in that a higher-
compression ratio is harder on the engine in terms of wear and tear,
and high compression needs higher octane fuel to prevent detonation
from happening inside the cylinders.

I have learned from the old-timers around my airport, that the 8.5:1
compression ratio 160hp version of the O-320 seems to be the sweet
spot, in that it can burn auto-fuel as long as you use premium
unleaded, 91 octane, and make sure you have big enough fuel lines that
are well-insulated from any heat source, and use a bigger, stronger
fuel pump system to prevent vapor-lock from happening. A 160hp O-320
that is throttled back to produce 150 hp will use less fuel per hour
than a 150hp low compression version of the same engine running at the
full 150hp power setting. The 160hp will also have cooler running
cylinder temps at that power setting too.

9:1 compression ratio in the otherwise same exact hypothetical O-320
will need 100LL to keep from suffering detonation, and will probably
suffer some anyway, and might be a maintenance headache, but it sure
will run strong when it's fresh.... for a little while anyway.

I had a buddy who built a Glasair III and had 10.5:1 pistons in his
IO-540. It sure was fast and strong, but he put a new set of pistons
in it about every 18 months. The old ones always came out with
multiple cracked rings, cracked ring grooves/lands, and sometimes
small holes melted between the dome and the 1st compression ring
groove. I think he must have had to work on that plane 20 hours of
repairs for each hour he flew it.

The 8.5:1 160hp O-320 seems to be the best proven choice for power
and longevity. I'd recommend that.