Rapid Engineering has the solution to this problem, but unfortunately they dont make it on a residential scale.

If you take 80% return air, and 20% outside air, and run that OSA through a direct-fired gas burner, then two things happen: You get 90-degree or so on the discharge air temp, and it pressurizes the building. This forces warm air out all the little crackes, and eliminates all the drafts and moisture infiltration. This is how the huge manufacturing facilities are heated - it's cost effective, partly because the efficiency youre losing by dumping hot air out is made up with 100% efficiency on the burner. Partly because most buildings are required by code to have at least 15% OSA anyway - more if the occupancy is high. And a lot because there's no ductwork - the heat naturally distributes itself throughout the building, and if there is a cold spot you add a little exhaust there. All the well-designed commercial buildings are slightly pressurized for this reason - about 0.01" positive. These guys have perfected a control system based on the pressure, it will close down the burner if a door is left open for longer than a setpoint, and opens up the dampers to 100% OSA if the pressure demands it. NOx isnt a problem - the burners put out way below the allowable limits, much less than is normally outside on a busy intersection. You can get it in indirect-fired, too, but the direct fired is much more efficient.

It's a nifty deal - I wish somebody would make a small one for small shops.

: You've got absolutely the right idea. If you have a lot of air infiltration,
: no amount of insulation will make up for it.

: Shawn