To my adimttedly limited knowledge, if you completely replace your gasoline with ethanol the only bad things that happen have to do with the air/fuel mixture. Most all cars are designed to run on gasoline and the computers or whatnot are set up for that. The performance will decline unless you reprogram the computer. At the University I went to they had a pickup truck comverted to 85% ethanol and 15% gasoline. But to answer your question, no I don't think you destroy your engine, but I would not recommend it... until gas prices get REALLY high.
Not so simple. Using methanol or ethanol as a fuel reduces cylinder lubrication, and the alcohol can also contaminate the engine oil, causing wear and damage to the engine. Could also damage fuel injection systems.
If an engine is optimized for ethanol, it will likely use a higher compression ratio to take advantage of ethanol's high octane (105 or 120, can't remember which) to boost efficiency. Fuel injectors (or carburetor jets) will be nearly twice as large as with gasoline. Fuel tank should probably be enlarge accordingly to maintain the same range. Cold starting WILL be a problem on pure alcohol. This is the reason for using M85 or E85, which is 15% gasoline and 85% alcohol. Due to alcohol's affinity for water, the fuel system metallurgy will probably need to be upgraded to stainless steel. Elastomers (O-rings, etc) in the fuel system may need to be changed.
