NOx indicates high combustion temperatures and excess oxygen. It basically means that your engine is running lean or hot or both. Advancing the timing is the fastest and easiest way to make NOx. Running ethanol-rich fuel is a good way to run lean (although you shouldn't with a functioning O2 sensor).
Carbon buildup may be the reason for the pinging, but I doubt that it is causing your NOx emissions. It is possible, but not likely.
Possible causes:
EGR not functional - (not an issue, s5s had no EGR)
Ignition timing too far advanced - (likely, especially considering the pinging)
Cooling-related problem (possibly running very hot combustion because the coolant flow is inadequate near the combustion region)
Carbon buildup (a stretch, but could be insulating the rotor from cooling the charge and storing combustion heat over time)
To fix the carbon buildup, I usually beat the car really hard for a while and then while it is still hot and idling, take of a vacuum line and stick it in a 1 liter bottle of water. You will see a cloud of white smoke and it should largely clean your chambers.
You can try the other stuff, but most of it works on the same principle as the water, flash cooling of the carbon makes it fragment and go out the exhaust in little flakes
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1986 GXL ('87 4-port NA - Haltech E8, LS2 Coils. Defined Autoworks Headers, Dual 2.5" Exhaust (Dual Superflow, dBX mufflers)
1991 Coupe (KYB AGX Shocks, Eibach lowering springs, RB exhaust, Stock and Automatic)
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