My advice really is to stick with a regular (cheap & durable) filter element unless changing the intake box entirely. And I have heard that people who overoil the K & N filters have reported lots of emissions problems, but if you follow the instructions, shouldn't be a problem. And don't get me wrong- I put a K & N element in the stock airbox of my '75 Porsche 914. It works fine, but I noticed no performance improvement. If I had it to do over, I'd just put a good quality (Purolator) air filter in (less than $10) and change it when it gets dirty with another $10 filter.
Re the underdrive pulley, I used one of bilett aluminum and it weighed half of what the stock one did, and spun faster because of the smaller diameter. Maybe I wasn't clear. Very much like unsprung weight on wheels, and how smaller-diameter, lighter wheels/tires result in an increase in quickness and a reduced top speed.