I'm stuck typing one-handed for a while so this will be brief.
If you supply the HAC input with a static signal for sea level and the car runs better the it's likely running a bit lean normally. HOWEVER, leaning out or enrichineng can also compensate for other issues such as bad timing (mech and ign). Just unplugging the HAC may put the ECU in a failsafe mode (just as far as the sensor in question's input is concerned) causing the ECU to add a little more fuel on top of the trim for sealevel. Use a resistor network to provide the ECU a true sealevel signal, it's only a matter of sticking two resistors in the harness connector.
O2 sensor won't make any difference except for after warm starts with it disconnected (you'll run rich) and during closed loop operation at normal operating temp.
Before the damper is the fuel rail.
If you're referring to the return then no, that's not a pressurized hose. Yes, use the CSI's port on the rail.
Have you tried another AFM?