You'd get better energy density that way, but I think it's offset by worse efficiency & more damage to the engine. The inert gas fraction (N2, CO2, H2O) provides a useful working fluid to convert combustion heat to force pushing on the piston. Burning pure O2 would mean a lot more heat is needed for the same amount of force. Higher peak temperatures & more available oxygen will tend to create hotspots & knock/pre-detonation, & possibly erosion of the cylinder wall & piston from directly burning the metal.

Using nitrous or cool compressed air keeps most of the benefits while mitigating the problems of using pure O2.