perhaps I have confused effeciency with economy.

Bang on. Peak engine efficiency is always slightly below peak torque RPM and usually about 80% of available torque at this RPM. At lower load, mechanical losses dominate. At maximum torque, spark retard and enrichment reduce efficiency. At very low engine speed, heat losses from the combustion chamber dominate. At higher engine speed, mechanical losses dominate. This all gives rise to efficiency island which make up the brake specific fuel consumption map.

As far as fuel economy goes, it depends on engine size, gearing, and aerodynamics. Air resistance always wins at high speeds. At 40mph rolling resistance and air resistance are roughly equal. The power required to overcome air resistance rises with the CUBE of speed, so the battle is hopeless. With your engine combination, best economy comes in at ~50-60mph.

Like most older cars, your top gear is ridiculously low. 74mph requires maybe 40hp on flat ground. At 3200 RPM that only equates to ~65lbf.ft torque-about half the available torque.

40 mpg from a 2-litre petrol sounds good by any standards, particularly for a 16-year-old car. It would be poor for a diesel, but 2.0E sounds like a petrol.