| If you just look at theory, the one with the most peak HP is capable of doing the most work. You would simply always have the engine running at the peak HP rpm and the transmission would be infinitely variable meaning the gearing will always be optimal. But reality isn't so perfect. In reality, you can't always keep the engine at the optimum rpm, and the gearing has ranges that take the engine through a band of rpm's. With that said, you'd want the engine that has the most power under the curve. Like your example of the domestic vs the Z, yeah, the Z is pulling harder at the end of the track and has the higher trap speed. But the domestic usually finishes before the Z. It has done more work in a shorter amount of time. Towards the end of the track the Z is doing work at a faster rate than the domestic did, but over the length of the track the domestic did more work on average. There is no lack of 9 second domestics, even if they don't look great doing it. Also, the closer you are to the starting line, the more effect your effort has on your ET. Think about it. If the tree turns green and you slowly inch up for two seconds and then floor it, your ET will be 2 seconds slower than it would have been if you floored it all the way. However, if you floor it down the track and let off the gas 2 seconds before the end of the track, your ET will not be 2 seconds longer. It won't be that much longer at all. That is because your speed's rate of change at the end of the track is nowhere near as drastic as the rate of change at the beginning of the track.
If you don't believe me, try running down the first half of the track at quarter throttle and the last half at full throttle. Now compare the results to when you go down the go down the first half of the track at full throttle and finish the last half at quarter throttle. In both cases, your engine still produced the same average output throughout the run. But the results in ET differed quite a bit. Now, with *that* being said, you can see how being able to exert more effort at the beginning of the track delivers far better ET results than being able to exert more effort at the end of the track, and how a higher torque/lower HP engine can deliver the better ET. While the *average* power output may have been slightly lower, its output where it counted most was higher, and then tapered off. This is why domestic iron dominates the quarter mile, even if they do pancake at the end. 
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00:44:21 01/20/04
Theory and reality sometimes differ though. (My rebuttal) - 
