Joe, don't forget, that you are comparing a prime Zeiss lens ("prime" meaning fixed focal length) with a zoom. While the image quality of zooms have increased dramatically in comparison to twenty years ago, I'd venture to say say that primes usually beat zooms. A generalisation for sure but true with only a handful of exemptions. The 80-400 zoom, while high quality, isn't one of Nikon's absolute best - the 200-400 for example is in a different league and would compare differently. But not at f40.
By the way, diffraction is not limited to lenses of digital cameras. It was noticed shooting film as well. But, as Thierry mentioned, today's sensors require the very best lenses and shooting technique - proper focusing, ideal aperture, tripod, mirror lockup, etc. for best image quality. Compromise as you deem fit.