It will not allow any "extra air" to flow into the engine. If you do the math on 99% of the engines out there you will discover that the factory paper elements flow about 4 times the amount of air than the engine can ever use. And they filter better than the K&N as well because they have smaller passages through the filter media. They have also caused failed sensors and SEL lights due to the oil on them.
Warmer air will always hurt performance and mileage. Colder air is denser air. The denser the air charge is into the engine the more power it can make on the same amount of fuel. The factory airbox also silences a LOT of intake noise. If this wasn't the case why would 99% of racers use ways to funnel cooler air to the filters and avoid underhood air.