What is discussed as being measured here is the power that is transmitted. Whenever power transmission is involved, a case that is familiar to all EEs is that of power transmission lines. For example, shunting a battery will just heat the battery because of its internal resistance. We also know that if the load is matched to battery and transmission line that maximum power is transmitted to the load. The bicycle is no different.

When measuring the power transmitted, we do not have any idea of how much power can be generated without knowing the power that is reflected because a human body might be able to dynamically change themselves so that the generator is more matched to the load. The gear train gets a person close to matched. For example, when at a dead stop a low gear will allow forward movement easily and a high gear is just very hard to get moving.

That being said, gearing alone is one way to improve power transmission by matching the generator, line, and load. This is not the end yet because proper seat adjustment is also necessary so that the human body can properly transmit power to the pedals, otherwise there could also be a mismatch. On top of this, if you use the ball of your foot on the pedals, one can learn how to distribute the forces so that they are more matched to the line and load.

Given this information, a person capable of creating 1KW of power may only be able to transmit 200W if they are unfamiliar with the use of the bicycle, but a person capable of 750W may be able to transmit more than 200W because they are familiar with mechanics of how their body interacts with the machine.

So, in reality the bicycle is not as efficient as it may sound because the generator is not always matched to the line and load. Coming up with a machine that is capable of delivering most of the power the load would be very dramatic in the form of human powered vehicles and may make transportation based on petroleum a thing of the past.