I was wondering if the filter inside a cold air box, but the AFM is mounted under the cold air box so all it is seeing is cold air.

The filter is connected to a pipe to the intake and the AFM is mounted with no hoses attached to it.

Performance gains or problems? I don't want to test this out w/o knowing first.

 

The afm HAS to be inline with the filter.

 

wait a second--look at the stock S4....technically, it is always inline, but if he is saying "not in a straight line" then why not?? So you have a cone filter sticking straight up, with a 90 degree elbow into adapter and afm....as long as you have enough room, I don't see why not....You wouldn't be able to get rid of ALL hoses, since it has to be connected to the tb. I don't think this will do anything for performance though, you will not get much cooler air that way. you would be better off using a more common intake style and trying to insulate it from the rest of the engine compartment.