[RanciD]

I'd imagine that the reason for putting it on the cold pipe is cause there's really no reason to cool air if it's not going to your engine anyway, it's a waste. There's probably a better reason though. And yes, you should recirculate the blow off air back into the intake otherwise you're going to mess with your air-fuel ratios and your car isn't going to run right (it will run rich everytime you shift if I'm not mistaken).