dbeck - In addition to JT's comments about break-down of the lubricating properties of the oil, as oil temperature increases, viscosity drops, and almost always oil pressure drops with decreasing viscosity. I saw significant increases in oil pressure with reduced temperatures as well. Lastly, the higher the oil temp, the more thermal expansion engine components see. That impacts wear in the engine, and also shortens the life of gaskets and seals.
There are also challenges with oil running too cool - so some sort of t'stat for the oil cooling system is usually a requirement, especially for street cars that see winter duty with low ambient temps. Ideally, you'd like to see oil temps in the 210-220F range. There's a reason the high temp viscosity rating temp (the one that applies to the second number on a multi-vis oil) is set at 100C degrees = 212F. That's an ideal hot operating temp for the oil. Warm enough for the oil to be at a viscosity the engine can deal with for the long term and to boil off condensation in the crankcase; cool enough to allow for longer oil life (less breakdown), less wear and tear on the engine and gaskets.
By the way, all of this is independent of HP output of an engine. It doesn't matter how much HP the engine makes -- there's an ideal oil operating temp -- and 250-270F ain't it. And it's amazing how the oil temp will climb when you work the engine hard. On my dyno pulls, you could see the gauge start at about 180F-190F, and it would climb into the 220F range just with one pull (WITH the cooler). Typically, however, a higher output engine is capable of putting more heat INTO the oil more quickly when it's running under high load.
What are your oil temps running dbeck?