Compression or Flow ? Or a combo of both ?
Combo+
Everything about a two stroke is duality of functions at the same time. Increases in swept compression from machining the band and base do more than just increase final compression. It also increases squish efficiency and increases the time of the power stroke coming down. The more down push on the piston the more power and torque can be made.
Note that increases in torque are generally followed by increases in horsepower, not the other way around so much.
Transfer flow is important for what is being compressed. The closer the intake fill is to 100% without spilling over into the exhaust the more power can be made.
Proper exhaust flow helps pull in the new intake charge.
Flow through the intake dictates how much venturi effect will pull fuel from the carburetor.
The less is more theory only works on saws that are already running at a better efficiency. Example- Take a MS660 and a MS661, the more efficient 661 needs to be moved nowhere near the amount of the 660 that needs a lot to get it where it needs to go. In the end they run right with each other pretty close.
No load RPM has little bearing on the measurement of power of a work saw. Some to the extent where little to no gain is found however going from let's say a stock peak load RPM of 9,000 to between 10,000 and/or 11,000 RPM and we have a saw that will cut wood for its CC size.
If the rest of our mods like timing etc. are done properly, then it will try and hold it in this increased cut RPM, too little or too much and it will let it run away from peak loaded RPM.
This is just a good start of all the things going on and the cause and effect happening.
At the end of the day how everything about the modifications working together will yield the final results. Just how everyone goes about this will never be identical in nature and give his/hers saw a unique flavor. When you think about it, just the effect of our grinding on the cylinder with each piece of chaff coming off entering into a mathematical volumetric computation into the millions...