If you're feeding your engine a certain amount of fuel, you will be able to do a certain amount of work due to the energy contained in the fuel. When the engine is creating 65% power on the ground, it is putting say 50% power to the propeller and 15% for pumping losses. Those number are made up. When you go to 8000', if you're at the same fuel flow (20GPH) and mixture (0.08), you will create the same power....So now, it would be say 55% power to the propeller and 10% for pumping losses.
So I think this comes down to interpretation of what we mean by the "same power". If we're talking about "brake horse power", the pumping losses must be taken into account before measuring the power -- it's power at the brake, after all. But you're saying that the constraint is that the nominal power, before taking into account such losses, is the same at altitude as at sea level.
If you look at a typical engine nomogram (as Brian Abraham posted earlier in the thread), the process of finding the (brake horse) power consists of 4 steps:
1) Find the power at full-throttle altitude
2) Find the power at sea-level
3) Interpolate between the two
4)
Then correct for
non-standard temperature as a density correction formula
That implies to me that steps 1 to 3 include both a correction for temperature in the ISA and for pumping losses. If the latter were not included, why bother with the complex nomogram? You'd just apply the density correction formula as in step 4.
What is not clear to me is how to work out fuel consumption as altitude changes. Lycoming, for example, publishes a chart of fuel consumption as a function of "actual brake horsepower", RPM and "mixture strength" (i.e. a line for best power and a line for best economy). I assume that this is measured at sea level. No guidance seems to be given as to how that varies with altitude. The temperature will not affect the fuel consumption for a given BHP, since denser air just means more fuel for the same mixture setting. But the pumping efficiency will mean that more BHP are produced for the same fuel at altitude compared to sea level.