The way a car motor works, the fuel and O2 are combusted, the heat released from that reaction heats up the remaining gases in the cylinder, primarily nitrogen. That heating causes the gases to expand, that expansion is what pushes down on the piston and does the work. I don't remember enough of my chemistry to calculate what the difference in work between the two concepts would be, but I'm thinking that the actual amount of work from combusting a pure mixture with no inert gases would be less.
JazzMan