By blocking the air to the MAF you are changing the calculation for load so it will read lower and increase timing that will help in mid-low load situations but if your timing map was close to the point of knocking in the high load area it can cause problems.
As for fueling the O2 sensor will compensate to the difference in fueling and adjust till it hits and stays at 14.7:1. With out the MAF getting a proper reading the engine will not be able to respond to a quick change in air flow. That will result in a lean mixture with to high timing when going from 20% throttle to 100%and that can pop pistons/heads/cylinder walls depending on the weak point.
To get the most benefit you should have a custom tune done on the car to increase the timing to a few points before the point of KR when the car is running on a hot day, if it is done on a cold day the KR will happen at a higher advance.
Depending on how the cars tuning is set up you might be able to disconnect the the MAF and run is SD (Speed Density) mode for the tune and get different results.
I would NOT do any of that without a scanner that at the very least will show you KR in real time to keep you from blowing your engine.
-I have had some fun tuning GM cars and this post is going to make me drive my wife's car so a can work on the tune again since I do not have the tools to tune me TDI.
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"It's not rocket surgery!" -MetroMPG
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