Sorry, but I disagree. First, it IS necessary for there to be some sort of air inlet for the PCV to function properly. The only way to evacuate the crankcase fumes is for them to be replaced by fresh air. Suck on a straw with the other end capped and you get no flow.
And as for the setup in the photo being "correct" for that air cleaner, sorry but that is also not correct. Flip that air cleaner over and you'll find a knockout on the underside, inside the filtered area. When new, this air cleaner came with a bolt-on elbow SPECIFICALLY for this purpose. If you needed a closed PCV system, the instructions (which usually were just thrown away) told you to remove the knockout and install the elbow and gasket. This provided a fresh air port that was supposed to routed to the breather cap in the valve cover.
Yes all of that about the air cleaner is true, so is the risk of a crankcase explosion. As for breathing, Ford has dead ended PVC in California forever it seems. The blow-by feeds the suction if it passes that much, other wise the crankcase just operates under a vacuum which helps with ring sealing. Aside from that on a street engine there is no need to vent to the atmosphere, they are not trying to vent fresh air into the enigne the PCV is there to prevent blow by from entering the atmosphere.
If you're racing then it's a different problem where this arraingement will not be satisforctory.
His current set up is just fine, not my preference, but it's fine. I never use those open air filters on the street, I find it's tough to improve on what the factory used for carbs and TBI with an enclosed round filter element wih a thermostatic and vacuum switched air source that draws hot air off the exhust when the engine is cold then closes that to draw cold air from behind the grill when the engine is warmed up. These, at least for GM, then supply an air source to the crankcase with the PCV at the other side. All these hot rod air filters do is to let the engine draw under hood hot air all the time, if he's worried about horsepower it's probably costing 10 or 15 at red line since power goes down quickly as inlet air temp goes up. So these things may look cool, but looks aren't everything.
Bogie