25" diameter --> 20" diameter = 20% decrease in gearing, so ~20% increase in torque. You cannot solve for a 30 lb. or whatever force increase and equate it to a faster car...torque (and the force generated) is an instantaneous value; what you're doing is regearing for higher rpm so that you're putting out more power at each speed.
It's really the difference in circumference, because that's the distance through which the torque acts, but diameter is linearly related so it works.