Ok, so I finally got around to looking into this; the oil line from the rear of the trans was just going to the ground, that should go to the small fitting on the oil tank correct? Easily fixed, but I'm wondering, could that tube not being connected make the bike blow more oil from the hose that comes off the valve cover? That is where the oil seems to be coming from. Thanks.
Right, plugs to lower nipple on the tank. On to your question, not really so much. It takes a while to visualize where those tubes go to and come from. The one on the back of the trans is a bit of a breather, from the engine to theoutside. But that's not the primary purpose. That nipple on the back of the oiltank is part of a pipe that goes up the inside of the tank to the breather/condensor at the top.
So, it is really the feed for the chain oiler. Oil mist is condensed at the top of the tank, then drips down the internal pipe, into the rubber hose and into the transmission. If you've ever had a bottom end apart, you'd see that nipple on the back of the tranny enters the cases and terminates above a collection plate that dumps into the final drive shaft and ultimately oils the chain.
So back to your question, oil mist comes out the breather from the top of the engine at the cam cover. Excessive oil mist from that tube is most likely an indication of ring blowby, pressurizing the crankcase, pressurizing the cam chain tunnel, pressurizing the cam cover area and escaping at the hose on top.
Could also be valves but more likely rings.
Put some seafoam in before the next few oil changes to free up any sticky rings. Ride it till you re-ring it.