Water extraction do not need be done by equal volume of water, about 10-20% would be sufficient - of course in 2-3 portions. This is a kind of countercurrent extraction, which is optimal method in this case. There would be a problem with recovering ethanol from water, this is an example of hard industrial rectification (kind of fractional distillation). In laboratory mixtures case I would recommend direct distillation as boiling point of ethanol is 60 deg lower than start of gasoline distillation. In practice, commercial gasoline frquently contain a lot of lower and higher boiling substances, which complicates separation.