Rather than try to explain all the reasons why I think nitrous for routine use is a bad idea, I'll just cut and paste.
Read through this and try to think about how you're going to over come the challenges of spark timing, mixture control, fogging, required fuel flow, increased internal pressures and CHT's, etc etc etc.
I'm not saying it's impossible... but as a means of over coming a lack in horsepower for climbout on a routine basis, I think you're playing with fire.
If I was building a single use racer for Reno or something like that, I could justify it. However all you need is one quick detonation with this stuff in your motor on climb out, and it's all over.
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In racing applications, nitrous oxide is injected into the intake manifold (or just prior to the intake manifold) to increase power. Even though the gas itself is not flammable, it delivers more oxygen than atmospheric air by breaking down at elevated temperatures, thus allowing the engine to burn more fuel and air. Additionally, since nitrous oxide is stored as a liquid, the evaporation of liquid nitrous oxide in the intake manifold causes a large drop in intake charge air temperature. This results in a smaller, denser charge, and can reduce detonation, as well as increase power available to the engine.
Detail
Nitrous oxide is comprised of two parts nitrogen and one part oxygen. When the nitrous oxide is introduced into the intake tract of an internal combustion engine, it is sucked into the combustion chamber and, on the compression stroke, when the air charge temperature reaches 565 degrees F, a very oxygen-rich mixture results. Nitrous oxide does not burn, it is an oxidizer. If we add extra fuel during nitrous oxide injection, the effect is like a super charger or increasing the compression ratio of the engine. By burning more fuel, higher cylinder pressures are created and this is where most of the additional power is realized. Nitrous oxide has this effect because it has a higher percentage of oxygen content than does the air in the atmosphere. Nitrous has 36% oxygen by weight and the atmosphere has 23%. Additionally, nitrous oxide is 50% more dense than air at the same pressure. Thus, a cubic foot of nitrous oxide contains 2.3 times as much oxygen as a cubic foot of air. Bottom line: nitrous oxide injection is much like a supercharger or a compression ratio increase in that, during combustion, it can dramatically increase the dynamic cylinder pressure in the engine.
Secondly, as pressurized nitrous oxide is injected into the intake manifold, it changes from a liquid to a gas (boils). This boiling affect reduces the temperature of the nitrous to minus 127 Degrees F. This "cooling affect" in turn significantly reduces intake charge temperatures by approximately 55-85 Degrees F. Cooler intake air is denser and contains more oxygen atoms per cubic foot. So cooler air will allow more fuel to be burned and in turn, make more power.
Nitrous oxide boils at -129°F and it will begin to boil as soon as it is injected. This can cause an 80° or so drop in manifold air temperature.
Side Note: For every 10 Degrees F reduction in intake charge temperature, a 1% increase in power will be realized. Example: A 400 HP engine with an intake temperature drop of 70 Degrees F, would gain approximately 30 HP on the cooling affect alone.
Finally, the nitrogen that was also released during the compression stroke performs an important role. Nitrogen acts to "buff or damper" the increased cylinder pressures leading to a controlled combustion process and better slower heat release.
Too Much of a Good Thing?
It should be noted that if the cylinder pressure in the engine is significantly increased, so will there be an increase in potential detonation. The burn rate is increased and requires less timing advance for peak output. Peak cylinder pressure must occur at approximately 20°ATDC to make peak power. If you speed the burn rate, peak cylinder pressure will occur too soon. It is easy to run too much ignition advance with nitrous, but too much will not only hurt power, it can quickly bring a nitrous engine into detonation and destroy it. This is why almost all nitrous motors require retarded spark timing during nitrous oxide operation.
Another challenge with a nitrous oxide system is getting the delivery of nitrous oxide and additional fuel at the correct proportions. The chemically correct nitrous to fuel ratio is 9.649:1. If you feed nitrous to the engine without enough extra fuel, the lean air/nitrous to fuel mixture will make the detonation problem even worse. The oxygen that was left over from burning the limited amount of fuel will result is a lean burn situation raising cylinder temperatures and melting components. If the proportion is such that too much fuel is delivered, the power advantage degrades rapidly.
What About Torque?
Torque is the force that turns the crankshaft and creates acceleration. People are consumed with horsepower (HP) numbers, but HP is not what creates acceleration for winning drag races. HP does create top end speed which is fine for land speed records or long distance endurance racing where acceleration rate / torque is not what determines the winner. To get the best out of nitrous, you need to utilize the massive torque it provides and concentrate on getting the highest torque across the whole rpm range.
Nitrous oxide systems make large amounts of torque by allowing an engine to burn more fuel at a lower rpm range than normal. Burning more fuel this way creates a longer burn period (and slightly higher cylinder pressures, if the timing is not corrected), that will push down on the pistons with greater average force. When the nitrous is injected into an engine and the initial combustion takes place, it creates enough heat to separate the nitrous oxide into its two components, nitrogen and oxygen. Once separated, the additional oxygen is then free to allow combustion of the additional fuel, while the released nitrogen acts as a buffer against detonation and damps mechanical loads.
If Oxygen is so Great, Then Why Not Pure Oxygen?
Air has only 23.6% oxygen by weight, the rest is made up largely of nitrogen. That nitrogen does not aid in combustion at all, but it does absorb and carry heat away. When you add nitrous, it has 36% oxygen with the rest being nitrogen. So the more nitrous oxide you add, the less percentage of nitrogen is available to absorb heat. That is why nitrous increases engine heat very rapidly. If we were to add pure oxygen (which has been tried), the percentage of nitrogen would fall even lower as more oxygen was added. We would not be able to add much oxygen before heat was a problem to control. Also compressed oxygen is in a gaseous form, so adding oxygen takes up more room and reduces normally aspirated power, and the amount of nitrogen from it. To put it simply, using nitrous oxide, we can get more oxygen atoms in the engine and have a lot more nitrogen as well. Nitrous can make much more power before heat is uncontrollable.