All 3 occupants of the aircraft are pilots and USAF officers. They said that after takeoff they were flying over a canyon area enroute to a local practice area. Once over the canyon area at 4,500 ft, the pilots noticed that the engine was beginning to run slightly rough with a perceptible and steady decrease in RPM's. The RPM's eventually decreased to 1,800 and all attempts to correct the power loss were unsuccessful. The aircraft was unable to maintain level flight and had descended below the tops of the surrounding ridges. The pilots stated that the only viable option open to them was to contact the hillside in a controlled manner. The aircraft was stalled into the thick brush covered hillside. Crash site inaccessibility precluded determination of the fuel system continuity or fuel supply quality. The carburetor, gascolator and ignition leads were destroyed in the crash. Detailed examination of the engine revealed heavy sooting of the #1 top spark plug and moderate erosion and gas blow-by of the pistons. Compression tests during the last 100 hour inspection showed 3 cylinders below 60 psi. The last major overhaul of the engine was 25 years and 2,221 hours prior to the accident. The engine manufacturer recommends a major overhaul every 2,000 hours or five years.