The Extra compression is everything to worry about if you do not have the octane rating of the fuel to run with it.
While yes today's motors get away with running lower octane fuel for the most part by sensing detonation and detuning themselves, it makes little sense to increase the compression so that it can sense detonation and detune itself.
That happens to b e the flaw in the argument.
If you do not have the octane rating to deal with the static compression, then it is simple, don't raise the compression and then tune to run like you stole it.
Octane rating of premium pump grade gasoline ranges (at least that I have seen on road trips, ranges from 90 octane in New Mexico with 95 octane available in parts of New England. Generally 91 in the SW and then East of the Mississippi 93 and 94
Crate engines are sold in general with a minimum recommended octane rating and the higher the compression the higher the minim recommendation is.
The Term pump gas is generally used as an advertising come on to make an engine appear universally acceptable, however if you are smart enough to ask what pump gas means when it comes to octane rating? They will tell you. And 9.8 is not acceptable if the premium pump puts out 91 octane.
And yes as far as most other things of building a modified engine around the original engine management system, they will adapt and compensate up to a point with little or not problems. And for the most part, minor things can be changed to fool the system to think it is o.k. and get away with it.
And one mentioned is fuel delivery, if needed and they are available larger injectors can be installed which would deliver more fuel than designed originally, and the system will try to hold them open as expected but if something like the O2 sensor indicates that it is running rich, they will get shut off early. And as long as the system is running with in it's window of operation it is happy.
A speed density system is notorious for being tricked. I have an off set MMAP sensor which is adjustable on a speed density system that I can fool the engine into running lean for fuel economy or rich for performance. A simple thing, but it works. That is one way to get around a system that does not have the capability to deal with a performance chip which actually changes the algorithms the system plays with.
They will keep the system smog legal if you do not get it to perform outside the window it was designed to run with in. And as to fuel economy, if you are going to build more performance in frankly you do not care about fuel economy. That is not the reason you are building performance in. But on the other hand, if it develops more power efficiently under partial throttle conditions where real time tuning is an issue, there are certainly a high probability that it will develop the power needed using less aggressive set points and do it with using less fuel.
AS far as smog testing goes if you can get it to fire all the cylinders during the test it will probably pass smog. Which makes the idle RPM a bit tricky and if you can solve that, smog in general is not a problem.

welcome back, unc