i love the idea... i wish i could put it on my bike, but i don't think there's enough space...
definitely think that finer mesh would be better, or maybe thicker foam insulation? like that stuff they use in sound proofing walls?
also why would that "tube" of mesh really impede airflow that much? i don't think performance will drop
also, its easier for me to understand apprehension about putting material upstream of the engine (you mentioned in its defense the silencer in an exhaust, but that's downstream, so poses no danger of going into the engine, unless your expansion exhaust is somehow magically tuned to suck it back in all the way into the cylinder)
btw i'm running an a55 conversion on an older bike, and set everything up, waiting for a tecnigas, already filtered and jetted, how do you like yours? (noticed it from pics)