Torque and HP produced by a engine is not changed by a transmission, I cannot change gear ratios and gain or loose crankshaft HP or torque.The wheel (inertia) dyno knows the time it took to spin the drum, the drum speed (MPH), the drum mass, and the engine RPM. From that, it computes the power that would be required to spin the drum at the rate of acceleration. If the drive ratio was 1:1 (including the fulcrum arm of the wheel) and the engine produced 100 TQ and there was no loss in the drivetrain then 100 TQ would have been applied to the drum as well. Change the ratio to 10:1 reduction. The engine still produces 100 TQ, but 1000 TQ is applied to the drum. If the Dyno is doing what it should do, it should still report 100 TQ from the engine ... clear as mud? Current chassis dynos can give correct cranshft HP if given feilds are accurately entered,thus negating the addition of the transmission. A engine makes the power and torque it can make and cannot do anymore with a transmission,the transmision can help the engine apply that force in different ways.Maybe a bad explanation but maybe it helps.