I'm not a physicist either, but I did spend the night at a Holliday Inn.
I believe the laws of physics says that you'll just expend that energy in a different place
That is correct. Obviously correct.
The "same output" is also correct. It just wouldn't have to give up as much energy to friction and heat to achieve that same output.
I changed my rear from 4.56 to 3.54 gears and the truck took on a whole new life. It feels like it isn't working as hard and still doing more.