Also, what effect does the free expansion of gas in a vacuum have on rocket propulsion in space?

I'm not a rocket scientist, so I won't have a definite answer for this.

However, the net thrust generated by a rocket engine is governed by the following equation:

F

_{n} = mv

_{e-opt} + A

_{e}(p

_{e} - p

_{amb})

Where m is the mass flow of the exhaust, v

_{e-opt} is our effective jet velocity when atmospheric pressure is equal to the pressure at the nozzle's exit, A

_{e} is the flow area at the nozzle exit, p

_{e} is the pressure at the nozzle's exit, and p

_{amb} is atmospheric pressure.

As p

_{amb} in a vaccum would be 0, while all other variables would stay constant at all times given a steady, constant stream of exhaust, a rocket in space would be more efficient than a rocket in the atmosphere.