I have to say that both my Brother (Defender TD5) and myself (Disco TD5) fitted K & N filters and noticed a definite improvement in throttle response although no power gain. So far (touch wood) neither of us have experienced any MAF problems after several thousand miles and have noticed a very small increase in MPG.
I hate to say it, but it's probably a placebo effect. The K&N when clean will out flow the paper element, but at the cost of less filtering.
However a stock Td5 is hardly likely to be stressed or restricted by a paper element. It just isn't moving enough air to really worry.
The main issue with K&N's is, once they get dirty they flow way worse than a paper element. And they will require cleaning far more often than a paper element will need changing, maybe 2-4 times more often. So if you don't clean it, any potential gains (which must be small) will be short lived until cleaned again.
Cleaning itself can be an issue as it requires a cleaning agent and then an oiling agent. Both are fairly pricey. And re-oiling has to be accurate. It's very easy to over oil. Which firstly makes it flow worse than paper, but oil can then get on the MAF, which normally results in needing a new MAF.
Now despite all this, I'm not against K&N's or other filters. But I think the gains vs costs on a vehicle like a Td5 are far too limited for the outlay.
I'm not sure what type of K&N you are referring too. If it replaces the air box and other parts of the intake, then I'll retract my earlier comment and say it might offer a tiny performance gain, but this will normally be due to the stock setup being designed to reduce intake noise for NVH reasons. Removing these silencing and baffling sections with an aftermarket setup, will promote a bit more poke. If it's just an element swap, then the gains will so small you'd not be able to measure.
