When the original 170 started to die on me (138K abusive miles), I could feel the car getting sluggish off the launch but it felt fine at 2K rpm and up. I drove it around on 5 cylinders, and then 4 cylinders for a few months until I was unable to spin the bald tires in the rain. Finally pulled the head and found a nice hole in the top of piston #6, and #2 had a piece missing near the edge of the piston, and the adjacent cylinder wall was pretty badly scored.

My dad, who was the real expert on engines at the time (me being 17 and all) couldn't really explain it except to say it was from abuse.

I guess that's what happens when you drive around at WOT in first gear all the time. My dad wouldn't let me upgrade to a bigger engine until the first one blew, so I won that battle the only way I knew how.
Anyway, here's a quick test to see where you're leaking. Pull the plug on the weak cylinder. Use a small funnel to pour about 2 tbsp of 30 weight oil into the cylinder. Crank the engine (no start) for a few cycles to distribute the oil evenly. Recheck compression. If you gain considerable compression back, you are looking at leaky rings. If you gain nothing, the problem is probably a bad valve seat.
As far as how much HP you are losing, I'd say you are probably losing a few ponies right off the line, where you'll notice it most on the butt-dyno.