Well, JSRS6 said the circled pic was a PCV, so I assumed..

So Pancake/PRV valve feeds fresh air to PCV and then to manifold when off boost.. and shuts closed when on boost. Off boost, it uses outside air from intake pipe to cycle through valve cover and block, and push it into the intake manifold to clear out gas, but is not actually metered (comes in behind the turbos and MAF, etc). But as I read, its similar to having a small air leak in the intake tract. Which will actually lean out the mixture.

Then when on boost, the PCV shuts off flow to the manifold, and the PVR re routes air from valve/block area to INTAKE tract, in front of the MAF and turbos.. where it is then meterd?

Is my understanding correct?

I am guessing a faulty system could lead to lean codes (as I am getting)? IS this emissions related or sludge prevention related? Makes me want to rip it all out.