To felt or not to felt?

Go ahead, if it leaks... itll soak like a sponge and release it like a dog shaking off water across the cover and accessories.
Till it falls apart and maybe hits something like a wet rag

No harm in using it.
I don't, haven't run a seal cup/cover either in over a decade.

Chances are itll eat **** like the balancer you have there, hub will probably fall off. Get a new one. Elastomer is all cracked and oil contaminated