Nitrous Oxide is wayyyyy overrated. I'm glad they kept it out of this game. I work with forced induction systems all day at work, and out of all the different systems, Nitrous Oxide is complete crap. Forza is a simulator, not a rice boy fantasy, so it makes sense they left that crap out.
Oh, and FYI:
Nitrous Completely eliminates turbo lag? awesome...what scene from fast and the furious was that from? NOTHING completely eliminates turbo lag.
Nitrous does nothing for Dyno graphs huh? that's funny, i've personally tuned and seen cars make 20-100+ SAE WHP from nitrous. Shot the same time? ever hear of a throttle based microswitch? or maybe a computerized system (i.e. venom?) Yep, bottle empty = no extra power. At the same time, turbo seizes, no extra power. Supercharger belt snaps, no extra power. Sieze ain injector, no extra power. Run out of gas, no extra power. Holy crap, by your logic, NOTHING is power! EVERYBODY's TRUE HP is 0!
The formula to determine horsepower from torque is
(Lbs/Ft x RPM) / 5,252 = Horsepower.
Forced induction systems do add torque. Which is also, based on the formula above, is horsepower.