I have to wonder what would happen if you painted on some 'valve lapping compound' then spun the gears for a few minutes. It is an abrasive that is meant to grind valves to their seats for a good close fit. You'd have to experiment with this but you might be onto something as far as reducing gear noise. Not sure about any noticable power increase but a quieter engine might be the ticket.
Years ago, early 70s Pontiacs had some trouble with noisy timing gears. We used to fill the thing with Ajax cleanser, take it out on the highway and run the peediddles out of it for a few miles then bring it back in and flush the oil and put in new. It would quiet the cast iron gears down a lot. Then...they started putting nylon teeth on the cam gear and that's when the troubles started.