Ok, before we get to my question, I will describe the problem. You have a diver who jumps off a bridge with a slight angular speed about his center of mass (figure 1). While in the air, he curls into a ball. Only gravity acts on the person while he is jumping, and since gravity acts on the center of mass of the person, gravity provides no external torque and hence the angular momentum of the person is conserved. He then uncurls and dives into the water with the exact same angular velocity he started with. During this whole process, imagine that no heat is generated (a.k.a human body is 100% efficient, no air resistance, etc.).
So this is where I get confused. Intuitively, I think that if you end up the same angular velocity, then its like the diver never curled up in the first place and instead had the same angular velocity the whole time. So, the change in kinetic energy should be (mass of person) x (height travelled) x (gravitational field) due to the work done by gravity. But, it takes energy to curl up and un-curl. The internal chemical energy must be converted to something, but it seems as if it's not converted to kinetic energy (which I assume is the only thing that it could be converted to (might be a wrong assumption)). So, where does the internal chemical energy go?