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Just to be clear (because there are so many hoses down there), there's a 5/8" hose that runs from the "flame trap" up and over the valve cover. This hose T's into the intake hose for the turbo. The idea behind this is that the intake hose will always be at vacuum. This way the vacuum just upstream of the turbo helps to draw air up through the oil trap. The little hose on the elbow is to help keep vacuum on the crankcase at those moments when there's a better supply of vacuum at the intake (snapping off-throttle for instance). Even though the 5/8" hose T's into the intake hose, the vast majority of the air feeding the turbo is coming from the air filter/AMM.
For a much better description of the PCV system, and some creative ways to improve it, check out the site below courtesy of someone at turbobricks. Do keep in mind that there is a theory that some of the restriction in the system is intended to keep the airspeed up in the plumbing. If the air moves too slow, moisture may condense and freeze in those places with a real winter. Have fun...it's an evening's worth of reading.
http://www.pbase.com/stealthfti/pcv
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