.040 Head gasket=more HP?
To answer your original question, with a .040 it should be 4-5hp and 7tq.
Lingenfelter stated .020 quench was safe on LSx's.
Cartek sends every H/C package out with a .030 gasket.
Show me a failure with .020 quench to support your opinion. While your opinion has as much value as anyone else's, there is no data to support it. Fortunately you dont have to go so close since there are options for maximizing compression so running a .040 gasket plus some milling is fine. I am just pointing out that the quench requirements you state arent fact. There are many cars out there running a .030 gasket and doing fine.
For one thing, the block is aluminum, which will create .006 or more of additional clearance when hot. Also, the stock hyper pistons have a lower coefficient of expansion than forged, and also transfer less heat, so the pistons will not grow as much under operation. And the piston/wall clearance is tighter, meaning less piston rock.
But there are a number of variables impacting minimum safe quench, and if you're running a different short block than the factory LS1, LS2, or LS7, for instance an iron block with forged pistons and slightly looser bearing clearances, .020 will almost certainly not be safe.
Also, if folks are using very tight quench, it's even more important than usual to make sure the engine is fully warm before running high revs ...

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