Yep, I have seen it both ways, this particular diagram is from Sharpe. The way I see it, running back to the compressor would be more efficient in keeping the water droplets from reaching the end of the line where your hose is. If it leans away from the compressor, that would be more efficient in keeping the CFM up. The air molecules wouldn't be hitting the water molecules on the way down the pipe. Just a theory from a non-engineer type.