Compression ratio will have an effect on your system. The compression ratio indicates the effect of the high pressure (120 PSI) on the flow, due to turbulance created in the pipe.
You will need to divide your flow rate by the compression ratio to determine the actual flow. (Or in your case multiply the compression ratio by 2 CFM to determine what the actual CFM needed at high pressure will be, since you know the flow rate you want to achieve.)
Compression Ratio, CR, is calulated as the line pressure (P)+ local atmospheric (Patm)/ local atmospheric (Patm).
CR = (P + Patm)/Patm
Lets say your area has standard conditions of 14.7PSI add this to 120PSI = 134.7PSI / 14.7PSI = 9.16 CR
Which means you will need to move about 18.32 CFM to obtain 2 CFM to your point of use using 120 PSI air.
9.16 * 2 = 18.32 CFM
So keep in mind you are not trying to move 2 CFM through your pipe, you need to move 18.32 CFM at 120 PSI.
