The 7 mm sure does reduce output ...I am one of the few who actually owns and operate a Nitro engine dyno and have tested inset extensively ..and yes a 7 mm insert drastically reduces power , in some engines it can be more then 25% loss as opposed to a 9mm.. even in a lower timed offroad engine the losses are quite big and of course in a higher timed onroad the losses are even more....

The wear and tear comes from the engine being choked back and being forced to run leaner in an attempt to make power.. As well the choking the engine back narrows the tuning window and increases the likelihood of running lean

The engine rules were very foolish and not well thought out and have done nothing towards making the class any more affordable, all they have done is needlessly slowed the class down and taken away some of the excitement and thrill.. In the grand scheme of things the racing is no cheaper and the cars are needlessly hobbled so these rules need to repealed and the class allowed to run at its full potential.

Anyways who came up with these rules ?

As you might have noticed I am not a fan of needles arbitrary rules, especially in motorsports..for some reason these RC sanctioning bodies seem to get carried away and tend to make some very shortsighted rules that have very big and substantial negative consequences to the sport...