What are the specific challenges and potential solutions for reducing NOx emissions in diesel engines without sacrificing fuel efficiency, considering the trade-offs between various aftertreatment technologies and in-cylinder combustion strategies?
NOx is formed at high combustion temperatures, in the presence of abundant nitrogen. Diesels get high combustion temperatures by virtue of their high compression ratios, which are necessary for autoignition. Reducing the temperature at which heat is added in the Otto cycle will reduce NOx formation but also reduces the Carnot efficiency of the cycle. N2 concentration in the combustion chamber can be reduced by diluting it with exhaust gas but this decreases the concentration of oxygen available to support combustion and thereby reduces the power output of the engine.
The best way we currently have for reducing diesel emissions is by aftertreatment of the exhaust or, for the ethically-challenged, Volkswagen-style cheating.
For those of you who did not know about this, there's an exhaustive (pun intended) article about the VW defeat device cheat on wikipedia.