The dryness of pure N2 is the principal reason it's used in airplanes. The phase change of water in the tire can affect the pressure.
But let's be honest, not many car tires go from -65C (Cruise altitude air temperature) to 125C (spin up and heavy braking on landing) in a few seconds like airplane tires. In fact, even race cars don't experience those temperature swings.
At 35 PSI inflation pressure, the boiling point of water is about 260F (125C). It's the water phase change that can affect tire pressure adversely. Street driven cars don't get to that temperature where the liquid water changes to steam and affects pressure.
But a reasonably dry air compressor won't put enough water in your car tires for this to be a problem. I would avoid coin-op gas station compressors for this reason. The 1/4 turn ball valve drain in my compressor was the best mod I could make. The water content is nearly zero, as it gets drained daily.
By the way, water vapor is a gas, and, as a consequence, it follows the universal gas law PV=nRT just the same as nitrogen, or oxygen, or argon. So a bit of water vapor makes no difference.