Confused on PCV system for 360 magnum

Yes that would be the best plan. That way any air coming "in" to the crankcase has to pass thru the aiir ilter first. But you don't have to do it that way. You can just put a filtered breather in the valve cover opposite the one with the PCV valve. K&N makes nice filtered breathers, but even the "cap" style ones with what looks like a brillo pad inside work pretty well.