I must still be missing something regarding the chart data. You say “notice the difference between 10,000 ft and 2,000 ft is about 8HP for a given setting”. If I start at 2000 feet on the right side of the chart and look at the intersection with the 2700 rpm line, I read 187HP in the middle of the chart. If I go to the 10,000 ft vertical line and again move up to the 2700 rpm line, I now read 140HP. This is a reduction of (187-140) 47HP, not the 8HP that you quote, if I am interpreting the chart correctly.
Further, the AFS manual, on page 58, states that for an O-360, the delta HP with altitude at 8000 ft is 9.1 HP. We all know the rule of thumb that normally aspirated engines cannot exceed 75% power above 8,000 ft. For an O-360 rated at 180HP, this would be a 25% reduction, or 45HP, not the 9.1 HP in the manual example. The chart I posted above for an IO-360 A model supports this as well; maximum power at 8000 ft. is indicated as 150 hp, reduced 25% from a sea level maximum of 200HP.
So I think I must be missing something, can you please explain your numbers? How did you get them?