Yes, it does go where you have it...the filter stack with several of those no longer available rare parts collect the oil vapor and the moisture and oil that collect drip into the bottom of the airbox into the drain. The drain hose has that no longer available pinch to open valve and their is a foam filter element inside that end of the valve. It takes any unburnt gases in that vapor and brings them back through the carbs to burn those vapors. Really no downside of using the design as opposed to venting to atmosphere. You typically don't see oil stains on the filter when the filter stack is working with the foam and other pieces in that stack. So, having the motor rebreath those fumes is more environmentally friendly. The oil vapor is tough to contain otherwise and with the moisture it usually looks foggy on cold mornings and you don't have a mess on the motor from that vent if not rerouted.
It is too bad some of the cool hydraulic storage rack systems for multiple bikes are not much cheaper, they could make having more bikes in a more compact area, if you have the headroom to support their use.
