There was a long thread on Speed Talk recently that was started by an engine builder in Colorado who was bragging about how much power an engine was making. Turns out his correction factor was 1.38 so 1/4 of the power was coming from the correction factor.

He got taken to task for that since the correction factors really are not designed to compensate for that big of a difference in air density. One engine builder pointed out that the engine moves air and that the density of air matters in terms of how the engine runs. So given that you can't just say an engine that makes 400 hp at 7000 ft elevation will make 600 hp at sea level. The correction factor might tell you that but the engine might not respond that way.

As an engineer I don't have any problem knowing that the same exact engine makes 5% more or less HP when I test it on a different dyno. There is no such thing as the "truth". You can scatter plot it and come to the conclusion that the "truth" is somewhere in the middle of all of the dots, but nobody will ever know what the "truth" is.

I'm not really sure how well dyno's correlate to each other. It is fairly easy to use the same correction factor but the dyno itself has characteristics on how well it converts the rotating energy into the load cell. There is some "black magic" that goes on inside of the stator housing. I wouldn't be surprised that dynos can vary a significant amount depending on who designed the stator housing and how well it was machined. I'm not even sure how the dyno mfgs test these things. They might use an electric motor with a known output to drive the dyno and then calibrate the load cell based on that known input? Like I said, black magic to me.