The dust can go thru a un-oiled K&N air filter but the instructions say to oil it with their (high dollar) oil.
The first time I oiled the K&N I bought, my G5 had a very noticeable drop in power so I removed the filter and did a (home made) air flow test on it.
With the oil applied as it was, it was about twice as restrictive as the stock paper air filter.
Using K&N's degreasing fluid to remove the oil, I applied just a hint of oil to the filter and tried again.
My airflow test showed that the K&N was now, less restrictive than the stock paper filter so I thought I was on the right track.
I reinstalled the K&N in my G5 and buttoned it up.
My seat of the pants dynometer told me that most but not all of the horsepower had returned. This was most noticeable at high rpm's where the engine seemed to run out of wind.
During the next tank of fuel my fuel mileage dropped a bit.
Without some elaborate test equipment and a transparent air box that duplicates the stock one on my bike, I'm guessing but I decided that the larger, tapered body of the K&N filter was actually decreasing the open area into the throttle bodys intake.
In other words, the filter body, being larger placed it right up next to the air intake causing it to restrict airflow into the engine.
Following this experiance, I replaced my old paper filter.
The engines power seemed to return and the old fuel mileage did return so that's the filter I'm now using.
Others results may vary.