When diluting a hydroalcoholic mixture with water, the final volume is lower than the sum of the volume of water + the starting volume.
This article explains its origin. He presents a study which demonstrates that in the case where analysis by distillation requires dilution, it is nevertheless possible to obtain good precision in the measurement of the alcohol level.
To measure the alcohol content in a spirit, the official method by distillation is still the most used method because it is the most universal and the least expensive in investment.
There are different types of distillation devices (direct distillation or steam entrainment), more or less automated, but which all have a maximum field of application for measuring the alcohol level.
This article explains how to use the device even if the alcohol level is above its use limit, while obtaining accurate results using appropriate methodology.