a cone filter setup and drawing air from the front grill via inteseperformance Quick Cold set.

http://intenseperformance.com/products/cone_filters/cone_filters.html

I am purchasing Urs4's MAF stageIII, Silicone hose, TB.

I was considering going back to stock air box and purchase VS, keep current plumbing from the lower grill(fog light area) and just connect it to the air box. Please let me know your thoughts.

With the airbox and the plumbing from the bumper grille and I have no complaints.

The lower inlet also has some sort of plastic pieces inside. Where is the CAI used?

From UrS4's picposter:

<img src="http://pictureposter.audiworld.com/711/90cai3.jpg">

<img src="http://pictureposter.audiworld.com/711/90cai4.jpg">

that will work with your car is the throttle body and he can't offer an exchange (ie you have to send in yours and get the same one back). You should email his to make sure. Good Luck!