What is this for???

I kinda remember there being a little 90 degree elbow hose to the blower motor, but I might be imagining that. I always thought it was to drain the blower motor if required, but I guess forced cooling air makes more sense. A simple hole would be fine to drain.

No, it's to equalize the back pressure for the blower/squirrel cage... If you want to push air with the blower, you need that....