Agree that oil has to be present to coat the wool. Wonder why no visual indication that oil was ever present to be sucked up and trapped in the media. It's obviously a serviceable item as the clamps are a servicing mechanism How is it mounted on the engine.......cup down such that it could hold oil? If it's mounted as shown in your first picture and the cup is on the bottom...seems to be 3 pieces as the cup in pic #2 has no "port" attached......like in my Fords, the air flowing through the device creates a differential pressure which sucks the oil up into the medium, coating it and when the engine is off, the dirty oil falls down into the cup and the dirt particles settle to the bottom to be removed and fresh oil added at servicing intervals.
My 2000 and 3000 Fords both have oil bath air cleaners. Going to say that the molecules of any oil that may get sucked up into the engine are too large and require too high a temperature to combust supporting not a concern for runaway.
I'm going SWAG the cup is full and needs to be serviced regularly. Why don't you fill it full (can't get any fuller than that) and try it out. Run it for say, 8 hours, let it sit for a day or so and pop the cup looking for dirt and checking the oil level.
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Today's Featured Article - Restoration Story: Fordson Major - by Anthony West. George bought his Fordson Major from a an implement sale about 18 years ago for £200.00 (UK). There is no known history regarding its origins or what service it had done, but the following work was undertaken alone to bring it up to show standard. From the engine number, it was found that this Major was produced late 1946. It was almost complete but had various parts that would definitely need replacing.
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